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Hong Leong Finance Limited (SG:S41)
SGX:S41
Singapore Market

Hong Leong Finance Limited (S41) AI Stock Analysis

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SG

Hong Leong Finance Limited

(SGX:S41)

Rating:72Outperform
Price Target:―
Hong Leong Finance Limited demonstrates solid financial performance with strong profitability and a robust balance sheet. The valuation is attractive with a low P/E ratio and a high dividend yield. Technical analysis suggests a generally positive trend despite recent short-term weakness. Cash flow challenges are a concern but do not overshadow the company's overall stability and growth potential.

Hong Leong Finance Limited (S41) vs. iShares MSCI Singapore ETF (EWS)

Hong Leong Finance Limited Business Overview & Revenue Model

Company DescriptionHong Leong Finance Limited (S41) is a leading financial services company based in Singapore. The company operates primarily in the finance sector, offering a wide range of financial products and services. These include personal and commercial loans, deposit services, government assistance programs, and corporate finance advisory. Hong Leong Finance is known for its commitment to providing tailored financial solutions to individuals and businesses, ensuring customer satisfaction and financial growth.
How the Company Makes MoneyHong Leong Finance Limited generates revenue through its diverse portfolio of financial services. The primary source of income comes from the interest earned on loans extended to individuals and businesses, which include personal loans, car loans, and business loans. Additionally, the company earns fee income from the provision of corporate finance advisory services and transactional fees. Deposit-taking activities also contribute to the company's earnings, as it utilizes customer deposits to fund its lending operations, earning a spread between the interest paid on deposits and the interest received from loans. Partnerships with government bodies for the distribution of government assistance programs further enhance its revenue streams. The company's strategic focus on understanding and meeting the financial needs of its clients, along with prudent financial management and risk assessment, play a crucial role in sustaining its profitability.

Hong Leong Finance Limited Financial Statement Overview

Summary
Hong Leong Finance Limited exhibits strong financial health with robust revenue growth and profitability. The balance sheet is particularly strong with no debt and solid equity, minimizing financial risk. Cash flow management exhibits room for improvement, with negative operating cash flows impacting liquidity. Overall, the company appears stable with a focus on growth and sustainability.
Income Statement
74
Positive
Hong Leong Finance Limited has demonstrated consistent revenue growth, with a notable increase of 7.54% in 2024. The net profit margin improved to 44.62% in 2024, indicating strong profitability. However, EBIT and EBITDA margins are not calculable due to missing data, which might suggest potential efficiency issues in operations.
Balance Sheet
81
Very Positive
The company maintains a solid balance sheet with zero debt and a strong equity position, reflected in a healthy equity ratio of 14.40% in 2024. The return on equity improved to 4.94%, showcasing effective use of shareholder funds. The absence of debt reduces financial risk significantly.
Cash Flow
68
Positive
Despite a high operating cash flow to net income ratio of -2.95 in 2024, indicating cash flow challenges, the company has managed its free cash flow effectively, though it saw a decline compared to previous years. The cash flow strategy appears to focus on maintaining liquidity, but the negative operating cash flow signals potential operational inefficiencies.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue474.42M233.28M216.93M258.74M189.42M157.43M
Gross Profit722.82M233.28M579.20M258.74M189.42M157.43M
EBITDA75.70M0.000.00165.05M109.95M82.64M
Net Income122.78M104.08M93.37M130.88M84.82M63.91M
Balance Sheet
Total Assets14.96B14.63B14.96B14.28B12.95B13.37B
Cash, Cash Equivalents and Short-Term Investments-1.50B1.11B1.16B926.04M828.65M933.24M
Total Debt17.92M0.0017.92M33.71M37.44M42.35M
Total Liabilities12.90B12.53B12.90B12.23B10.99B11.45B
Stockholders Equity2.06B2.11B2.06B2.04B1.96B1.92B
Cash Flow
Free Cash Flow86.59M-309.14M144.59M176.58M-65.81M-332.36M
Operating Cash Flow89.26M-307.27M147.53M178.01M-65.41M-332.01M
Investing Cash Flow-8.16M-1.87M-91.50M-1.43M-399.00K1.40M
Financing Cash Flow134.81M-81.02M517.70M-79.28M-38.78M-23.81M

Hong Leong Finance Limited Technical Analysis

Technical Analysis Sentiment
Positive
Last Price2.59
Price Trends
50DMA
2.51
Positive
100DMA
2.46
Positive
200DMA
2.41
Positive
Market Momentum
MACD
0.02
Negative
RSI
71.10
Negative
STOCH
84.72
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:S41, the sentiment is Positive. The current price of 2.59 is above the 20-day moving average (MA) of 2.54, above the 50-day MA of 2.51, and above the 200-day MA of 2.41, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 71.10 is Negative, neither overbought nor oversold. The STOCH value of 84.72 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:S41.

Hong Leong Finance Limited Peers Comparison

Overall Rating
UnderperformOutperform
Sector (72)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
SGD05
78
Outperform
$127.19B11.3817.99%6.67%13.03%12.01%
SGO39
74
Outperform
$73.88B9.8313.78%10.71%10.17%8.01%
SGS41
72
Outperform
S$1.16B11.124.99%5.81%3.85%11.43%
72
Outperform
S$32.13B14.1611.69%6.34%8.28%16.42%
SGY92
70
Outperform
$11.69B11.3715.42%5.07%33.63%1.49%
SGU11
69
Neutral
$60.10B10.1313.43%6.49%5.68%5.92%
SGZ74
59
Neutral
$64.20B15.9816.56%5.80%-2.10%-103.46%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SG:S41
Hong Leong Finance Limited
2.59
0.28
12.12%
SG:U11
UOB
36.12
5.58
18.27%
SG:Y92
Thai Beverage Public Co
0.47
0.05
10.98%
SG:D05
DBS Group Holdings
45.21
10.17
29.01%
SG:O39
OCBC
16.48
2.40
17.03%
SG:Z74
Singtel
3.86
1.17
43.49%
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 08, 2025