Chi Ho Development Holdings Ltd (8423) AI Stock Analysis

• Market Cap: HK$38.40M
• Dividend Yield: N/A
• Average Volume (3M): 105.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.29
• Revenue Growth: -1.68%
• EPS Growth: -417.79%
• Country: HK
• Employees: 76
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): -0.03
• Shares Outstanding: 800,000,000
• 10 Day Avg. Volume: 240,000
• 30 Day Avg. Volume: 105,000
• PEG Ratio: 0.01
• Price to Book (P/B): 0.26
• Price to Sales (P/S): 0.08
• P/FCF Ratio: 0.99
• 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: 56 Neutral
• Price Target: HK$0.05 ▲(0.00% Upside)

Chi Ho Development Holdings Ltd faces significant profitability challenges, reflected in its negative earnings and valuation concerns. However, improved cash flow and stable balance sheet provide some resilience. Technical indicators suggest moderate bullish momentum, but valuation remains a key risk.

Positive Factors

Improved operating cash flow

Operating cash flow turned positive after prior outflows and free cash flow improved, showing the company now converts operations into cash. This durable cash-generation improvement lowers liquidity risk, supports working capital needs, funds capex or debt reduction, and increases financial flexibility over months.

Balanced capital structure

A moderate debt-to-equity ratio and relatively healthy equity ratio indicate a balanced capital structure. Over the medium term this reduces refinancing and solvency risk, supports access to credit if needed, and gives management headroom to finance projects or weather revenue volatility without immediate distress.

Robust cash vs accounting losses

A favorable operating cash flow to net income ratio means cash conversion is stronger than accounting profits suggest. This structural strength allows the firm to sustain operations, service obligations, and invest selectively even while reporting accounting losses, improving its survival and recovery prospects.

Negative Factors

Negative profitability and margins

Net losses, negative EBIT margin and falling EBITDA reflect persistent profitability weakness. Over months this erodes retained earnings, reduces reinvestment capacity, weakens return on capital, and may force cost cuts or external financing, constraining strategic options and growth.

Declining revenue and gross margin

Inconsistent revenue growth and a falling gross profit margin indicate pressure on top-line and core unit economics. Structurally, sustained revenue volatility and margin compression undermine pricing power and profitability resilience, making recovery harder without cost or product mix changes.

Severe EPS deterioration

An extreme EPS decline signals material deterioration in net profitability versus prior periods. This has lasting implications for capital allocation, investor confidence, and ability to retain talent or fund growth; reversing such a trend typically requires sustained margin or revenue improvement.

Chi Ho Development Holdings Ltd Business Overview & Revenue Model

Company Description

Chi Ho Development Holdings Ltd (8423) is a Hong Kong-based investment holding company primarily engaged in the construction and engineering sectors. The company operates through various subsidiaries, focusing on providing construction services, including building, civil engineering, and renovation works. Chi Ho Development also invests in property development and management, aiming to capitalize on growth opportunities within the real estate market. Its core offerings are aimed at both public and private sector projects, positioning the company as a key player in the infrastructure development landscape.

How the Company Makes Money

Chi Ho Development Holdings Ltd generates revenue primarily through its construction and engineering services, which include contracts for building projects, civil engineering works, and renovation services. The company secures contracts through competitive bidding processes, often partnering with government agencies and private developers for large-scale projects. In addition to its construction activities, Chi Ho Development also earns income from property development and management, leveraging its investments in real estate to generate rental income and capital appreciation. Key revenue streams include contract payments from completed projects, ongoing contracts, and returns from property investments. Strategic partnerships with other construction firms and collaborations with governmental bodies enhance its project portfolio and drive revenue growth.

Chi Ho Development Holdings Ltd Financial Statement Overview

Summary

Chi Ho Development Holdings Ltd is facing profitability challenges with negative earnings and declining margins. However, significant improvement in cash flow and a stable balance sheet provide some positive aspects.

Income Statement

Chi Ho Development Holdings Ltd has shown inconsistent revenue growth with a decline in the latest period compared to the previous year. The company is currently operating at a net loss, with a negative EBIT margin and declining EBITDA, highlighting profitability challenges. Gross profit margin has also decreased, indicating potential cost pressures or pricing issues.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio, which suggests a balanced capital structure. However, the return on equity has turned negative due to net losses. The equity ratio remains relatively healthy, suggesting that the company maintains a reasonable level of equity financing.

Cash Flow

Chi Ho Development Holdings Ltd has demonstrated strong growth in operating cash flow, turning positive compared to a significant outflow in previous years. The free cash flow has also improved, indicating better cash management. The operating cash flow to net income ratio is favorable, suggesting that cash generation is robust despite reported losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	628.38M	497.51M	352.90M	337.68M	257.21M	281.67M
Gross Profit	35.35M	31.57M	40.54M	42.72M	34.29M	39.43M
EBITDA	-8.87M	-4.31M	18.58M	22.07M	13.70M	27.95M
Net Income	-22.94M	-12.29M	10.09M	13.15M	8.02M	21.44M
Balance Sheet
Total Assets	379.35M	379.35M	397.26M	344.08M	296.69M	260.87M
Cash, Cash Equivalents and Short-Term Investments	25.66M	25.66M	22.54M	43.96M	51.28M	33.32M
Total Debt	103.92M	103.92M	99.11M	93.29M	93.65M	40.85M
Total Liabilities	234.42M	234.42M	240.14M	196.76M	160.81M	133.36M
Stockholders Equity	144.93M	144.93M	157.12M	147.31M	135.88M	127.50M
Cash Flow
Free Cash Flow	37.84M	37.84M	8.09M	5.43M	-25.26M	8.12M
Operating Cash Flow	37.99M	37.99M	8.63M	5.57M	-18.50M	8.16M
Investing Cash Flow	-34.27M	-34.27M	-30.72M	-6.53M	-6.62M	78.00K
Financing Cash Flow	-597.00K	-597.00K	666.00K	-6.36M	43.07M	-16.71M

Chi Ho Development Holdings Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.05
• 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:8423, the sentiment is Positive. The current price of 0.05 is above the 20-day moving average (MA) of 0.05, above the 50-day MA of 0.04, and above the 200-day MA of 0.05, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 61.46 is Neutral, neither overbought nor oversold. The STOCH value of 61.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:8423.

Chi Ho Development Holdings Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3728	68 Neutral	HK$64.83M	7.62	6.32%	―	46.37%	-22.94%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
8423	56 Neutral	HK$38.40M	-0.93	-28.49%	―	-1.68%	-417.79%
8616	56 Neutral	HK$60.00M	-6.52	-5.13%	―	8.51%	-217.24%
8619	49 Neutral	HK$22.98M	0.38	31.39%	―	-15.18%	94.48%
8445	38 Underperform	HK$42.01M	-4.71	-11.29%	―	-41.79%	19.85%