Transtech Optelecom Science Holdings Limited (9963) AI Stock Analysis

• Market Cap: HK$445.47M
• Dividend Yield: N/A
• Average Volume (3M): 59.76K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.40
• Revenue Growth: -20.95%
• EPS Growth: -13.14%
• Country: HK
• Employees: 157
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): -0.05
• Shares Outstanding: 298,976,000
• 10 Day Avg. Volume: 48,800
• 30 Day Avg. Volume: 59,764
• PEG Ratio: -0.02
• Price to Book (P/B): 0.26
• Price to Sales (P/S): 0.63
• P/FCF Ratio: 4.77
• 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: 52 Neutral
• Price Target: HK$1.50 ▲(92.31% Upside)

The score is weighed down primarily by weak financial performance (declining revenue, negative margins, and negative free cash flow) and a loss-making valuation profile (negative P/E). These risks are partially offset by strong technical strength, with the stock trading above key moving averages and supported by positive MACD and neutral RSI.

Positive Factors

Recurring revenue and partner contracts

Established long-term service agreements and maintenance contracts create recurring revenue that improves revenue visibility and customer stickiness. This predictable income supports planning, helps fund R&D and incremental capex, and reduces reliance on one-off project wins over the medium term.

Exposure to structural demand for high‑speed connectivity

Transtech's focus on optical fibers and telecom equipment aligns with secular growth in data centers, 5G and broadband expansion. Structural demand for higher bandwidth provides a durable market tailwind and a sizeable addressable market for its core products over the coming years.

Relatively healthy equity position

A high equity ratio indicates lower leverage and greater balance sheet resilience, giving the company flexibility to absorb shocks or finance strategic initiatives without excessive debt. This provides a structural buffer while management works to restore profitability.

Negative Factors

Declining revenue and negative margins

Sustained revenue declines and negative gross/net margins point to fundamental demand, pricing or cost issues that impair core profitability. Over time this erodes competitive positioning, reduces reinvestment capacity, and makes it harder to scale margins even if top-line growth resumes.

Persistent negative free cash flow

Ongoing negative free cash flow signals that operations do not generate sufficient cash to cover investments and working capital. Structural cash deficits force dependence on external financing or equity, constrain capex and R&D, and raise sustainability concerns for long-term operations.

Negative ROE and shrinking assets

Negative ROE indicates the business is destroying shareholder value rather than creating it, while declining total assets suggest retrenchment or impairments. Together these structural signs limit growth capacity, hinder competitiveness, and may require strategic restructuring to reverse.

Transtech Optelecom Science Holdings Limited Business Overview & Revenue Model

Company Description

Transtech Optelecom Science Holdings Limited (9963) is a Hong Kong-based company that operates primarily in the telecommunications and technology sectors. The company focuses on providing advanced optical and communication solutions, specializing in the research, development, and manufacturing of optical fibers and related telecommunications equipment. Transtech's core products include high-quality fiber optic cables and components, which cater to various industries, including telecommunications, data centers, and broadcasting.

How the Company Makes Money

Transtech generates revenue through the sales of its optical communication products and solutions, catering to both domestic and international markets. The company has established key partnerships with telecommunications service providers and infrastructure companies, enabling it to secure contracts for large-scale projects that require extensive fiber optic networks. Additionally, Transtech capitalizes on ongoing technological advancements by offering innovative solutions that meet the growing demand for high-speed data transmission and connectivity. The recurring revenue from long-term service agreements and maintenance contracts also contributes significantly to its financial performance.

Transtech Optelecom Science Holdings Limited Financial Statement Overview

Summary

Weak fundamentals driven by declining revenue, negative gross and net margins, and persistently negative EBIT. Cash flow is also stressed with negative free cash flow in recent years, while the balance sheet is relatively more stable due to a higher equity ratio but still pressured by negative ROE.

Income Statement

The income statement reflects a challenging financial situation. The gross profit margin has decreased significantly, turning negative in the recent period, indicating cost management issues. The net profit margin is also negative, showing persistent net losses. Revenue has been declining over the years, with a notable drop from 2020 to 2024, which further weakens the financial standing. An EBIT margin consistently in the negative highlights operational inefficiencies.

Balance Sheet

The balance sheet shows a relatively healthy equity position with a high equity ratio, indicating financial stability. However, the debt-to-equity ratio has been manageable but remains an area to monitor. Return on equity is negative, reflecting the company's ongoing losses, which is concerning. The reduction in total assets from previous years signals potential asset management or investment issues.

Cash Flow

Cash flow analysis reveals significant challenges. Free cash flow has been negative in recent years, indicating cash outflows exceeding inflows from operations, which is unsustainable long-term. The operating cash flow to net income ratio is not favorable, showing cash flow issues even when compared to the net losses. The absence of positive cash flow trends further underscores the need for financial restructuring.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	113.91M	148.02M	174.21M	232.75M	155.94M	262.62M
Gross Profit	-3.25M	-275.00K	17.46M	29.86M	19.49M	42.61M
EBITDA	-15.79M	-6.42M	-54.24M	-48.98M	-81.47M	57.25M
Net Income	-93.81M	-94.85M	-64.22M	-70.82M	-87.32M	28.23M
Balance Sheet
Total Assets	401.65M	395.03M	517.11M	610.24M	719.19M	769.54M
Cash, Cash Equivalents and Short-Term Investments	11.56M	17.76M	14.49M	58.16M	14.00M	28.62M
Total Debt	30.88M	25.30M	37.56M	55.80M	68.42M	27.02M
Total Liabilities	46.25M	40.27M	66.74M	97.32M	123.83M	52.60M
Stockholders Equity	355.40M	354.76M	450.36M	512.92M	595.37M	716.95M
Cash Flow
Free Cash Flow	10.30M	19.64M	-23.29M	54.20M	-48.56M	-88.28M
Operating Cash Flow	10.70M	19.79M	-5.41M	55.23M	-46.46M	-50.77M
Investing Cash Flow	-573.00K	-125.00K	-17.81M	-494.00K	-2.09M	-37.36M
Financing Cash Flow	32.00K	-13.61M	-20.34M	-12.85M	34.63M	-16.59M

Transtech Optelecom Science Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.78
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9963, the sentiment is Neutral. The current price of 0.78 is below the 20-day moving average (MA) of 1.62, below the 50-day MA of 1.06, and above the 200-day MA of 0.54, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 47.13 is Neutral, neither overbought nor oversold. The STOCH value of 48.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:9963.

Transtech Optelecom Science Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1085	67 Neutral	HK$735.65M	-11.90	-3.08%	―	5.24%	-201.60%
6869	65 Neutral	HK$103.22B	102.02	4.79%	0.54%	14.38%	-41.96%
1617	65 Neutral	HK$284.59M	4.15	7.40%	―	-9.34%	605.26%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
1202	59 Neutral	HK$436.00M	-547.37	-0.09%	―	-23.93%	-109.41%
9963	52 Neutral	HK$445.47M	-4.05	-24.22%	―	-20.95%	-13.14%
1300	48 Neutral	HK$1.22B	-46.21	-0.68%	―	6.88%	-49.48%

Transtech Optelecom Science Holdings Limited Corporate Events

Transtech Enters Connected Framework Deal for Optical Fibre Preform Purchases

Transtech Optelecom Science Holdings Limited has entered into a framework purchase agreement under which its wholly owned subsidiary Transtech will purchase optical fibre preforms from Yinhu Optical Fiber (Tianjin) Co., Ltd. between 16 January 2026 and 31 December 2026, with pricing to be set per order by reference to prevailing market terms for comparable products. As Tianjin Yinhu is more than 30% owned by Futong China, one of Transtech’s controlling shareholders, the deal is classified as a connected transaction under Hong Kong listing rules; however, because the applicable percentage ratios fall between 0.1% and 5%, it is treated as a one-off connected transaction that requires only public announcement and is exempt from circular and shareholder approval, allowing the company to secure optical fibre preform supply while maintaining regulatory compliance without additional approval procedures.

The most recent analyst rating on (HK:9963) stock is a Hold with a HK$1.50 price target. To see the full list of analyst forecasts on Transtech Optelecom Science Holdings Limited stock, see the HK:9963 Stock Forecast page.

Transtech Optelecom Completes HK$18.22 Million Share Placing to Bolster Working Capital

Transtech Optelecom Science Holdings Limited has completed a placing of 38,976,000 new shares under its general mandate, raising net proceeds of approximately HK$18.22 million after commissions and expenses. The shares were placed at HK$0.476 each to at least six independent professional, institutional and other investors, increasing the company’s total issued shares from 260 million to 298.976 million, with the controlling shareholder’s stake diluted from 75% to 65.22% and new placees now holding 13.04%. The company plans to use about HK$5.97 million of the proceeds to repay bank and other borrowings and approximately HK$12.25 million for general working capital in 2026, including audit fees, rent and salaries, a move that strengthens its liquidity position and slightly broadens its shareholder base without changing control.

The most recent analyst rating on (HK:9963) stock is a Hold with a HK$1.50 price target. To see the full list of analyst forecasts on Transtech Optelecom Science Holdings Limited stock, see the HK:9963 Stock Forecast page.

Transtech Optelecom Announces New Share Placement to Enhance Growth

Transtech Optelecom Science Holdings Limited announced a conditional agreement to place up to 52,000,000 new shares at a price of HK$0.476 per share, representing a 20% increase in its current share issuance and raising approximately HK$24.4 million in net proceeds. The proceeds will assist in advancing the company’s operational and strategic goals, with the move likely to enhance its market position while expanding shareholder value, subject to necessary conditions and approvals being met.

The most recent analyst rating on (HK:9963) stock is a Hold with a HK$0.45 price target. To see the full list of analyst forecasts on Transtech Optelecom Science Holdings Limited stock, see the HK:9963 Stock Forecast page.