TL Natural Gas Holdings Limited (8536) AI Stock Analysis

• Market Cap: HK$46.75M
• Dividend Yield: N/A
• Average Volume (3M): 117.75K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.44
• Revenue Growth: 3.82%
• EPS Growth: 68.82%
• Country: HK
• Employees: 64
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): N/A
• Shares Outstanding: 212,505,000
• 10 Day Avg. Volume: 54,500
• 30 Day Avg. Volume: 117,750
• PEG Ratio: 0.09
• Price to Book (P/B): 1.01
• Price to Sales (P/S): 0.56
• P/FCF Ratio: -28.41
• 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: 48 Neutral
• Price Target: HK$0.22 ▼(-12.80% Downside)

The overall stock score is primarily influenced by the company's financial performance, which is hindered by profitability challenges and negative cash flows. Technical analysis suggests a lack of strong momentum, while valuation is negatively impacted by ongoing losses and the absence of a dividend yield. These factors collectively result in a below-average stock score.

Positive Factors

Low leverage / strong equity base

Extremely low leverage and a high equity ratio provide durable financial flexibility. This reduces solvency risk during commodity cycles, supports capital allocation for upstream investments or maintenance, and improves access to financing on favorable terms over months.

Sustained revenue growth

Material year-over-year revenue growth indicates expanding sales or volumes and strengthens the firm’s ability to scale operations. Sustained top-line expansion supports long-term margin recovery and amortization of fixed costs, improving structural profitability prospects.

Core business tied to natural gas transition

Operating in natural gas and distribution positions the company within the energy transition where gas serves as a bridge fuel. Stable utility and industrial customer contracts and distribution capabilities create durable demand and predictable revenue streams over the medium term.

Negative Factors

Negative profitability

Persistently negative margins show the business is not yet converting revenue into sustainable profits. Continued losses erode retained earnings, limit reinvestment ability, and increase dependence on external capital, undermining long-term value creation if unaddressed.

Negative free cash flow and weak cash conversion

Ongoing negative free cash flow and poor cash conversion constrain the company’s ability to fund capex, pay suppliers, or reduce liabilities from operations. This structural cash shortfall necessitates external funding and limits operational resilience over coming quarters.

Negative return on equity / capital destruction

A negative ROE signals the company is destroying shareholder capital rather than generating returns. Over time this reduces investor confidence, makes raising equity costlier, and hampers the firm’s capacity to pursue growth initiatives without diluting existing shareholders.

TL Natural Gas Holdings Limited Business Overview & Revenue Model

Company Description

TL Natural Gas Holdings Limited, an investment holding company, sells compressed natural gas (CNG) in Jingzhou, China. The company distributes CNG to retail customers, such as vehicular end-users; and wholesale customers, including urban gas companies, gas refuelling station operators, and industrial users. It also offers automated car wash services. The company operates four refuelling stations in Jingzhou, Hubei Province. TL Natural Gas Holdings Limited was founded in 2007 and is headquartered in Jingzhou City, China. TL Natural Gas Holdings Limited is a subsidiary of Yongsheng Enterprise Limited.

How the Company Makes Money

TL Natural Gas Holdings Limited generates revenue through several key streams, primarily focusing on the extraction and sale of natural gas. The company earns income by selling natural gas to utility companies, industrial clients, and commercial businesses. Additionally, it may engage in long-term contracts with strategic partners to ensure a steady supply of natural gas over extended periods, providing predictable revenue. The company may also benefit from partnerships with other energy firms, enhancing its distribution capabilities and market reach. Furthermore, fluctuations in natural gas prices can significantly impact revenue, making it essential for the company to manage its operations efficiently and adapt to market conditions.

TL Natural Gas Holdings Limited Financial Statement Overview

Summary

TL Natural Gas Holdings Limited is facing significant profitability challenges despite revenue growth. The balance sheet is strong with low leverage, but negative cash flows and net losses are concerning. The company needs to focus on improving operational efficiency and cash flow generation to enhance financial stability.

Income Statement

The company has shown some revenue growth, with a 23.5% increase from 2023 to 2024. However, profitability remains a concern, as evidenced by negative EBIT and net income margins. The gross profit margin improved slightly to 8.4% in 2024, but the net profit margin is still negative at -10.1%, indicating ongoing operational challenges.

Balance Sheet

The balance sheet is relatively strong with a low debt-to-equity ratio of 0.02, indicating low leverage. The equity ratio is high at 85.7%, suggesting a strong equity base. However, the return on equity is negative due to persistent net losses, which is a concern for long-term sustainability.

Cash Flow

The company has struggled with negative free cash flow, although there was an improvement from -4.07 million in 2023 to -1.90 million in 2024. The operating cash flow to net income ratio is negative, reflecting challenges in converting earnings into cash flow. The cash flow situation remains a critical area for improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	94.74M	96.28M	77.95M	67.59M	46.44M	50.94M
Gross Profit	7.87M	8.12M	7.49M	16.27M	-988.00K	-836.00K
EBITDA	-4.59M	-5.97M	-3.29M	2.22M	-969.00K	-15.62M
Net Income	-7.94M	-9.68M	-23.02M	-3.07M	-8.48M	-22.64M
Balance Sheet
Total Assets	64.37M	62.20M	69.16M	95.32M	97.61M	118.21M
Cash, Cash Equivalents and Short-Term Investments	32.10M	29.44M	34.17M	36.19M	29.65M	6.23M
Total Debt	707.00K	993.00K	1.80M	3.79M	3.75M	21.54M
Total Liabilities	8.49M	8.90M	9.88M	13.24M	13.34M	30.91M
Stockholders Equity	55.88M	53.30M	60.09M	82.65M	84.27M	87.30M
Cash Flow
Free Cash Flow	-1.11M	-1.90M	-4.07M	4.63M	18.74M	-18.69M
Operating Cash Flow	-1.04M	-1.78M	-1.70M	8.28M	24.31M	-10.78M
Investing Cash Flow	72.00K	120.00K	-1.99M	-3.65M	4.09M	-12.25M
Financing Cash Flow	4.96M	2.63M	-1.74M	-1.62M	-4.70M	3.32M

TL Natural Gas Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:8536, the sentiment is Negative. The current price of 0.25 is above the 20-day moving average (MA) of 0.23, above the 50-day MA of 0.24, and below the 200-day MA of 0.27, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 36.25 is Neutral, neither overbought nor oversold. The STOCH value of 32.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:8536.

TL Natural Gas Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
8536	48 Neutral	HK$46.75M	-4.70	-13.87%	―	3.82%	68.82%
1759	44 Neutral	HK$207.36M	-16.33	-3.11%	―	50.72%	-434.09%