SEHK:1766

Stock Analysis Report

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Executive Summary

CRRC Corporation Limited and its subsidiaries research, design, develop, manufacture, sell, refurbish, service, and lease locomotives and rolling stock in Mainland China and internationally.


Snowflake Analysis

Flawless balance sheet average dividend payer.


Similar Companies

Share Price & News

How has CRRC's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 1766 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

5.8%

1766

5.6%

HK Machinery

3.0%

HK Market


1 Year Return

-42.6%

1766

24.7%

HK Machinery

-0.9%

HK Market

Return vs Industry: 1766 underperformed the Hong Kong Machinery industry which returned 26% over the past year.

Return vs Market: 1766 underperformed the Hong Kong Market which returned 0.6% over the past year.


Shareholder returns

1766IndustryMarket
7 Day5.8%5.6%3.0%
30 Day-4.2%11.8%6.1%
90 Day-10.9%28.0%12.1%
1 Year-39.9%-42.6%27.9%24.7%3.1%-0.9%
3 Year-43.3%-48.6%57.7%45.9%7.1%-4.4%
5 Year-59.1%-65.6%78.9%63.0%8.7%-9.4%

Price Volatility Vs. Market

How volatile is CRRC's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is CRRC undervalued compared to its fair value and its price relative to the market?

16.23x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 1766 (HK$3.66) is trading above our estimate of fair value (HK$1.05)

Significantly Below Fair Value: 1766 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 1766 is poor value based on its PE Ratio (16.2x) compared to the HK Machinery industry average (11.8x).

PE vs Market: 1766 is poor value based on its PE Ratio (16.2x) compared to the Hong Kong market (10.5x).


Price to Earnings Growth Ratio

PEG Ratio: 1766 is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: 1766 is overvalued based on its PB Ratio (1.3x) compared to the HK Machinery industry average (1x).


Next Steps

Future Growth

How is CRRC forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

11.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1766's forecast earnings growth (11.1% per year) is above the savings rate (1.6%).

Earnings vs Market: 1766's earnings (11.1% per year) are forecast to grow slower than the Hong Kong market (17.7% per year).

High Growth Earnings: 1766's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1766's revenue (8.2% per year) is forecast to grow slower than the Hong Kong market (10.8% per year).

High Growth Revenue: 1766's revenue (8.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1766's Return on Equity is forecast to be low in 3 years time (9.4%).


Next Steps

Past Performance

How has CRRC performed over the past 5 years?

0.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1766 has a large one-off gain of CN¥3.1B impacting its March 31 2020 financial results.

Growing Profit Margin: 1766's current net profit margins (4.8%) are lower than last year (5.2%).


Past Earnings Growth Analysis

Earnings Trend: 1766's earnings have grown by 0.2% per year over the past 5 years.

Accelerating Growth: 1766's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1766 had negative earnings growth (-8.9%) over the past year, making it difficult to compare to the Machinery industry average (-8.7%).


Return on Equity

High ROE: 1766's Return on Equity (8%) is considered low.


Next Steps

Financial Health

How is CRRC's financial position?


Financial Position Analysis

Short Term Liabilities: 1766's short term assets (CN¥263.8B) exceed its short term liabilities (CN¥212.0B).

Long Term Liabilities: 1766's short term assets (CN¥263.8B) exceed its long term liabilities (CN¥25.2B).


Debt to Equity History and Analysis

Debt Level: 1766's debt to equity ratio (13.9%) is considered satisfactory.

Reducing Debt: 1766's debt to equity ratio has reduced from 23.7% to 13.9% over the past 5 years.

Debt Coverage: 1766's debt is well covered by operating cash flow (81%).

Interest Coverage: 1766 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is CRRC current dividend yield, its reliability and sustainability?

2.36%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 1766's dividend (2.36%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.26%).

High Dividend: 1766's dividend (2.36%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.67%).


Stability and Growth of Payments

Stable Dividend: 1766's dividend payments have been volatile in the past 10 years.

Growing Dividend: 1766's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (38.3%), 1766's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1766's dividends in 3 years are forecast to be well covered by earnings (33.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.8yrs

Average management tenure


CEO

Yongcai Sun (56yo)

2.75yrs

Tenure

CN¥1,396,000

Compensation

Mr. Yongcai Sun has been President since October 12, 2017 at CRRC Corporation Limited since and has been its Executive Director since June 20, 2017. Mr. Sun served as Vice President of CRRC Corporation Lim ...


CEO Compensation Analysis

Compensation vs Market: Yongcai's total compensation ($USD199.61K) is below average for companies of similar size in the Hong Kong market ($USD782.77K).

Compensation vs Earnings: Yongcai's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Hualong Liu
Executive Chairman3.58yrsno data0.00017% CN¥319.3k
Yongcai Sun
President & Executive Director2.75yrsCN¥1.40m0.00039% CN¥732.4k
Zheng Li
CFO & Chief Accountant0.75yrCN¥97.40kno data
Qiliang Lou
Executive Director0.58yrCN¥1.28mno data
Jilong Xie
Secretary of the Board5.08yrsCN¥896.50k0.00026% CN¥488.3k
Weiping Yu
Vice President5.08yrsCN¥1.28mno data
Jun Wang
Vice President5.08yrsCN¥1.28mno data
Yunshuang Ma
Vice President0.75yrCN¥97.40kno data
Gongcheng Wang
Vice President0.75yrCN¥97.40kno data

2.8yrs

Average Tenure

54yo

Average Age

Experienced Management: 1766's management team is considered experienced (2.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Hualong Liu
Executive Chairman3.58yrsno data0.00017% CN¥319.3k
Yongcai Sun
President & Executive Director2.75yrsCN¥1.40m0.00039% CN¥732.4k
Qiliang Lou
Executive Director0.58yrCN¥1.28mno data
Patrick Sun
Independent Non-Executive Director5.17yrsCN¥141.00kno data
Guo'an Li
Independent Non-Executive Director6.08yrsCN¥60.00kno data
Zhenhan Chen
Shareholder Representative Supervisor1.08yrsno datano data
Hu Zhao
Chairman of Supervisory Committee0.58yrno datano data
Xiaoyi Chen
Shareholder Representative Supervisor0.58yrno datano data
Yuanchao Zhu
Independent Non-Executive Director0.083yrno datano data
Jianzhong Shi
Independent Non-Executive Director0.083yrno datano data

0.8yrs

Average Tenure

57yo

Average Age

Experienced Board: 1766's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

CRRC Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: CRRC Corporation Limited
  • Ticker: 1766
  • Exchange: SEHK
  • Founded: 2007
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Market Cap: CN¥169.471b
  • Listing Market Cap: CN¥187.799b
  • Shares outstanding: 28.70b
  • Website: https://www.crrcgc.cc

Number of Employees


Location

  • CRRC Corporation Limited
  • No. 16 Central West Fourth Ring Road
  • Haidian District
  • Beijing
  • Beijing Province
  • 100036
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CRRR.FOTCPK (Pink Sheets LLC)Foreign Shares-Foreign ListedUSUSDAug 2008
1766SEHK (The Stock Exchange of Hong Kong Ltd.)Foreign Shares-Foreign ListedHKHKDAug 2008
C2LDB (Deutsche Boerse AG)Foreign Shares-Foreign ListedDEEURAug 2008
1766SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)Foreign Shares-Foreign ListedHKHKDAug 2008
1766SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)Foreign Shares-Foreign ListedHKHKDAug 2008
601766SHSE (Shanghai Stock Exchange)YesDomestic SharesCNCNYAug 2008
601766XSSC (Shanghai Stock Exchange - Shanghai - Hong Kong Stock Connect)YesDomestic SharesCNCNYAug 2008
CRCC.YOTCPK (Pink Sheets LLC)UNSPONSORE ADRUSUSDMar 2017

Biography

CRRC Corporation Limited and its subsidiaries research, design, develop, manufacture, sell, refurbish, service, and lease locomotives and rolling stock in Mainland China and internationally. The company provides metro cars, engineering machinery, mechanical and electric equipment, electronic equipment, environmental protection equipment, and related components. It also offers passenger carriages and coaches, freight wagons, MUs, and rapid transit vehicles. In addition, the company is involved in other businesses that utilize proprietary rolling stock technologies; research and development of electric traction and control technologies, as well as sale of applicant services and related products; international freight agency activities; and trading of raw materials. Further, it engages in information consultation; industry investment and management; asset management; finance leasing; import and export; the sale of machinery and construction materials; the sale and leasing of machinery equipment; accepting deposits and providing entrusted loans; the manufacture, sale, and repair of rolling stock; project management contracting; and the provision of logistics and after-sale maintaining services. Additionally, the company manufactures and sells wind turbines and electric motors; train bore systems and components; and polymer compounds, etc., as well as provides computer technology, basic software related, applicant software related, computer systematic, and data processing services. The company was formerly known as CSR Corporation Limited and changed its name to CRRC Corporation Limited in June 2015. The company was incorporated in 2007 and is headquartered in Beijing, the People’s Republic of China. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/10 13:01
End of Day Share Price2020/07/10 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.