Ying Kee Tea House Group Ltd. (8241) AI Stock Analysis

• Market Cap: HK$40.50M
• Dividend Yield: N/A
• Average Volume (3M): 22.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.26
• Revenue Growth: -7.42%
• EPS Growth: -0.97%
• Country: HK
• Employees: 50
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): -0.01
• Shares Outstanding: 361,650,000
• 10 Day Avg. Volume: 6,500
• 30 Day Avg. Volume: 22,500
• PEG Ratio: -0.18
• Price to Book (P/B): -4.21
• Price to Sales (P/S): 1.49
• P/FCF Ratio: 9.16
• 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: 45 Neutral
• Price Target: HK$0.11 ▲(21.11% Upside)
• Action: Reiterated Date: 02/05/26
• Date: Action: Reiterated 02/05/26

The score is held down primarily by weak financial performance (declining revenue, persistent losses, and a highly risky balance sheet with negative equity). Technicals provide some offset with improving short-term momentum, but valuation remains constrained because the negative P/E reflects unprofitability and there is no dividend yield data to support the investment case.

Positive Factors

Operating Cash Generation

Maintaining positive operating cash flow and a free-cash-flow-to-net-income ratio near 1 indicates the business converts reported losses into real cash, supporting near-term liquidity and working capital needs. Over several months this reduces immediate refinancing pressure and helps sustain retail operations while management works on profitability.

Gross Margin Cushion

Relatively high gross margins imply the core product (tea and accessories) commands pricing or sourcing advantages versus cost of goods sold. This provides a structural cushion: if operating expenses are controlled, the company can potentially restore operating profitability over months by tightening SG&A and improving retail productivity.

Direct Retail + Wholesale Channels

A dual revenue model—direct retail plus trading/wholesale—diversifies sales channels, smoothing demand swings and enabling scale in procurement and distribution. Over a 2–6 month horizon this structural mix supports revenue stability and offers multiple levers (pricing, channel focus) to improve margins and cash conversion.

Negative Factors

Negative Equity / High Leverage

Negative shareholders' equity and extreme leverage indicate solvency risk and limited financial flexibility. Over the medium term this constrains the company's ability to raise capital on favorable terms, increases refinancing risk, and may force operational trade-offs (cutting investment or stores) that impair long-term growth prospects.

Declining Revenue Trend

Sustained revenue decline and persistent negative margins signal structural demand or competitive issues that will not resolve quickly. Over several months this erodes cash buffers, limits ability to leverage fixed costs, and complicates recovery efforts, requiring durable improvements in sales or a shift in product mix to reverse the trend.

Weak Free Cash Flow Growth

Declining free cash flow growth, even with positive operating cash flow, reduces the firm's capacity to invest in stores, marketing, or inventory turns. Over a 2–6 month window this limits strategic flexibility, raises the chance of liquidity stress if operating trends worsen, and heightens reliance on external funding.

Ying Kee Tea House Group Ltd. Business Overview & Revenue Model

Company Description

Ying Kee Tea House Group Limited, an investment holding company, engages in the retail trading of tea products. The company offers various Chinese tea leaves under the Pu-erh Tea, Oolong Tea, Fragrant tea, Green Tea, White Tea, Old Luk On Tea, Black Tea, and miscellaneous categories; and tea wares and tea gift sets. It also distributes food and beverage products; and holds trademarks and properties. The company serves individual and corporate customers in Hong Kong. As of March 31, 2022, it operated 11 retail shops and concession counters selling approximately 80 products. The company was incorporated in 2017 and is headquartered in Siu Sai Wan, Hong Kong. Ying Kee Tea House Group Limited is a subsidiary of Profit Ocean Enterprises Limited.

How the Company Makes Money

The company makes money primarily by selling tea products and tea-related goods to customers. Its revenue model is mainly transaction-based: (1) Retail sales—income generated from sales of tea products and related items to end customers via its retail stores and other direct-to-consumer channels operated by the group. (2) Trading/wholesale sales—income from supplying tea products to business customers (e.g., distributors or corporate customers), where revenue is recognized based on product orders and deliveries. Key factors influencing earnings typically include sales volume, product mix (e.g., premium vs. mass-market teas), pricing, and gross margin management (sourcing costs, inventory, and retail operating costs). Specific information on major partnerships, customer concentration, or channel contribution breakdown is null.

Ying Kee Tea House Group Ltd. Financial Statement Overview

Summary

Overall fundamentals are weak: revenue declined (-5.05%) and profitability remains negative with negative EBIT/EBITDA margins. The balance sheet is a key risk with negative shareholders’ equity and very high leverage (debt-to-equity -8.53), while cash flow is somewhat supportive due to positive operating cash flow but weakening free cash flow growth.

Income Statement

The income statement shows a declining revenue trend with a negative revenue growth rate of -5.05% in the latest period. The company has consistently reported negative net profit margins, indicating ongoing losses. Gross profit margins remain relatively high, but the negative EBIT and EBITDA margins highlight operational inefficiencies and challenges in achieving profitability.

Balance Sheet

The balance sheet reveals significant financial leverage with a negative stockholders' equity and a high debt-to-equity ratio of -8.53. This indicates potential solvency issues. The return on equity is positive due to negative equity, but this is misleading as it results from substantial losses. The equity ratio is negative, reflecting a precarious financial position.

Cash Flow

Cash flow analysis shows a decrease in free cash flow growth, but the company maintains a positive operating cash flow. The free cash flow to net income ratio is close to 1, suggesting that cash generation is relatively stable compared to net losses. However, the overall cash flow position is weak due to declining free cash flow growth.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	29.52M	30.28M	33.94M	37.44M	36.06M	36.09M
Gross Profit	20.13M	23.22M	26.17M	28.75M	27.94M	27.80M
EBITDA	-5.30M	-5.53M	422.00K	7.83M	5.85M	4.84M
Net Income	-15.09M	-16.88M	-14.68M	-6.07M	-7.78M	-9.14M
Balance Sheet
Total Assets	85.57M	87.15M	101.58M	110.61M	117.49M	126.15M
Cash, Cash Equivalents and Short-Term Investments	1.36M	1.47M	2.91M	2.28M	1.87M	3.91M
Total Debt	90.44M	91.72M	92.21M	86.91M	94.71M	95.67M
Total Liabilities	101.08M	97.90M	95.01M	89.23M	97.10M	98.25M
Stockholders Equity	-15.52M	-10.75M	6.57M	21.38M	20.39M	27.90M
Cash Flow
Free Cash Flow	3.30M	4.94M	3.63M	9.28M	7.71M	8.78M
Operating Cash Flow	3.43M	5.06M	3.91M	9.33M	7.88M	9.07M
Investing Cash Flow	2.96M	-125.00K	-349.00K	-48.00K	-163.00K	10.77M
Financing Cash Flow	-6.38M	-6.38M	-5.04M	-8.88M	-9.76M	-21.73M

Ying Kee Tea House Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.09
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:8241, the sentiment is Positive. The current price of 0.09 is below the 20-day moving average (MA) of 0.11, below the 50-day MA of 0.10, and below the 200-day MA of 0.11, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 54.28 is Neutral, neither overbought nor oversold. The STOCH value of 17.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:8241.

Ying Kee Tea House Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1767	71 Outperform	HK$375.00M	12.59	5.48%	0.78%	5.43%	-25.42%
3838	63 Neutral	HK$1.05B	1.71	10.38%	5.38%	-6.58%	16.23%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
6868	61 Neutral	HK$3.16B	18.24	6.78%	3.70%	-16.51%	-35.38%
1717	59 Neutral	HK$3.49B	9.22	4.53%	2.90%	0.52%	99.51%
8241	45 Neutral	HK$40.50M	-2.20	114.90%	―	-7.42%	-0.97%