SEHK:2221

Stock Analysis Report

Executive Summary

New Concepts Holdings Limited, an investment holding company, operates in the construction industry.

Rewards

Trading at 97.3% below its fair value

Risk Analysis

Earnings have declined by -60.99% per year over past 5 years

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year

+ 1 more risk


Snowflake Analysis

Fair value with mediocre balance sheet.

Share Price & News

How has New Concepts Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2221's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.7%

2221

0.7%

HK Construction

0.6%

HK Market


1 Year Return

-79.9%

2221

-26.2%

HK Construction

-4.5%

HK Market

Return vs Industry: 2221 underperformed the Hong Kong Construction industry which returned -25.9% over the past year.

Return vs Market: 2221 underperformed the Hong Kong Market which returned -3.8% over the past year.


Shareholder returns

2221IndustryMarket
7 Day-2.7%0.7%0.6%
30 Day-12.3%-5.5%-5.2%
90 Day-25.3%-2.8%2.3%
1 Year-79.9%-79.9%-22.7%-26.2%-1.0%-4.5%
3 Year-89.0%-89.0%-35.2%-42.2%14.4%2.9%
5 Year-65.5%-65.5%-24.8%-35.9%15.5%-3.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is New Concepts Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 2221 (HK$0.36) is trading below our estimate of fair value (HK$12.97)

Significantly Below Fair Value: 2221 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 2221 is unprofitable, so we can't compare its PE Ratio to the Construction industry average.

PE vs Market: 2221 is unprofitable, so we can't compare its PE Ratio to the Hong Kong market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2221's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2221 is good value based on its PB Ratio (0.5x) compared to the HK Construction industry average (1x).


Next Steps

Future Growth

How is New Concepts Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

10.9%

Forecasted Capital Goods industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as New Concepts Holdings has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has New Concepts Holdings performed over the past 5 years?

-61.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2221 is currently unprofitable.

Growing Profit Margin: 2221 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 2221 is unprofitable, and losses have increased over the past 5 years at a rate of -61% per year.

Accelerating Growth: Unable to compare 2221's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 2221 is unprofitable, making it difficult to compare its past year earnings growth to the Construction industry (-5.4%).


Return on Equity

High ROE: 2221 has a negative Return on Equity (-20.83%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is New Concepts Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 2221's short term assets (HK$565.3M) exceed its short term liabilities (HK$544.6M).

Long Term Liabilities: 2221's short term assets (HK$565.3M) do not cover its long term liabilities (HK$686.8M).


Debt to Equity History and Analysis

Debt Level: 2221's debt to equity ratio (173.5%) is considered high.

Reducing Debt: 2221's debt to equity ratio has increased from 13.9% to 173.5% over the past 5 years.


Balance Sheet

Inventory Level: 2221 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 2221's debt is not covered by short term assets (assets are 0.7x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable 2221 has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: 2221 is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -6% per year.


Next Steps

Dividend

What is New Concepts Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%2.3%markettop25%6.4%industryaverage4.5%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate 2221's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 2221's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 2221's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 2221's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 2221 is not paying a notable dividend for the Hong Kong market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 2221's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

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

3.8yrs

Average management tenure


CEO

Shulan Qin (56yo)

3yrs

Tenure

HK$1,429,000

Compensation

Ms. Shulan Qin has been the Chief Executive Officer of New Concepts Holdings Limited since February 27, 2017. Ms. Qin has been an Executive Director of New Concepts Holdings Limited since May 24, 2016. Ms. ...


CEO Compensation Analysis

Compensation vs Market: Shulan's total compensation ($USD183.96K) is about average for companies of similar size in the Hong Kong market ($USD225.53K).

Compensation vs Earnings: Shulan's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Yongjun Zhu
Executive Chairman 3.8yrsHK$1.97m21.18% HK$42.5m
Shulan Qin
CEO & Executive Director3yrsHK$1.43m0.71% HK$1.4m
Jianwen Cai
Executive Director 4.4yrsHK$1.95m0.084% HK$168.0k
Tsi Lee
Company Secretary & Executive Director1.5yrsHK$2.64mno data
Chi Keung Chow
Financial Controller6yrsno datano data

3.8yrs

Average Tenure

45yo

Average Age

Experienced Management: 2221's management team is considered experienced (3.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Yongjun Zhu
Executive Chairman 3.8yrsHK$1.97m21.18% HK$42.5m
Shulan Qin
CEO & Executive Director3yrsHK$1.43m0.71% HK$1.4m
Jianwen Cai
Executive Director 4.4yrsHK$1.95m0.084% HK$168.0k
Tsi Lee
Company Secretary & Executive Director1.5yrsHK$2.64mno data
Wai Shek Choy
Independent Non Executive Director5.5yrsHK$391.00k0.12% HK$245.0k
Lihui Zhang
Non-Executive Director3.4yrsHK$120.00kno data
Chun Lo
Independent Non-Executive Director5.5yrsHK$391.00kno data
Ka Tong
Independent Non-Executive Director5.5yrsHK$391.00k0.084% HK$168.0k

4.1yrs

Average Tenure

54yo

Average Age

Experienced Board: 2221's board of directors are considered experienced (4.1 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: 2221 insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.7%.


Top Shareholders

Company Information

New Concepts Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: New Concepts Holdings Limited
  • Ticker: 2221
  • Exchange: SEHK
  • Founded: 1996
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$200.515m
  • Shares outstanding: 572.90m
  • Website: https://www.primeworld-china.com

Number of Employees


Location

  • New Concepts Holdings Limited
  • Office B
  • 3rd Floor
  • Kowloon Bay
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2221SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDSep 2014

Biography

New Concepts Holdings Limited, an investment holding company, operates in the construction industry. It operates through Construction Works, Sales of Construction Materials, Environmental Protection, and Industrial Fluids System Services segments. The company’s foundation works include socketed steel H-pile, soldier pile, pipe pile, geotechnical instrumentation, drainage, ELS, and pile cap works; and mini pile, king post, grout curtain, bored pile, rock socketed H-pile, ground investigation and treatment, hoarding and tree, and decontamination soil works, as well as superstructure contract works for residential development. It also undertakes civil engineering and general building works. In addition, the company is involved in the sale of construction materials; construction and operation of kitchen waste treatment plants; engineering, procurement, and construction of kitchen waste and water treatment business; and provision of industrial fluid system services. It has operations in Hong Kong, Mainland China, Sweden, and internationally. New Concepts Holdings Limited was founded in 1996 and is headquartered in Kowloon Bay, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 13:12
End of Day Share Price2020/02/18 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


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.