SEHK:3789

Stock Analysis Report

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Executive Summary

Royal Deluxe Holdings Limited, an investment holding company, provides formwork erection and related ancillary services in Hong Kong.


Snowflake Analysis

Flawless balance sheet and undervalued.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 3789's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-0.9%

3789

6.6%

HK Construction

6.6%

HK Market


1 Year Return

-45.5%

3789

-19.9%

HK Construction

0.6%

HK Market

Return vs Industry: 3789 underperformed the Hong Kong Construction industry which returned -19.9% over the past year.

Return vs Market: 3789 underperformed the Hong Kong Market which returned 0.6% over the past year.


Shareholder returns

3789IndustryMarket
7 Day-0.9%6.6%6.6%
30 Day-12.8%2.6%8.1%
90 Day-9.2%-2.5%13.9%
1 Year-45.5%-45.5%-15.8%-19.9%4.7%0.6%
3 Year-66.5%-66.5%-33.6%-41.7%9.7%-2.2%
5 Yearn/a-32.6%-43.7%12.5%-6.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Royal Deluxe 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: 3789 (HK$0.11) is trading below our estimate of fair value (HK$0.45)

Significantly Below Fair Value: 3789 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 3789 is good value based on its PE Ratio (4.9x) compared to the HK Construction industry average (8.6x).

PE vs Market: 3789 is good value based on its PE Ratio (4.9x) compared to the Hong Kong market (10.5x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 3789's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 3789 is good value based on its PB Ratio (0.5x) compared to the HK Construction industry average (0.9x).


Next Steps

Future Growth

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

10.2%

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 Royal Deluxe 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 Royal Deluxe Holdings performed over the past 5 years?

-6.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3789 has high quality earnings.

Growing Profit Margin: 3789's current net profit margins (3.8%) are lower than last year (7.2%).


Past Earnings Growth Analysis

Earnings Trend: 3789's earnings have declined by -6.2% per year over the past 5 years.

Accelerating Growth: 3789's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 3789 had negative earnings growth (-37.9%) over the past year, making it difficult to compare to the Construction industry average (-10%).


Return on Equity

High ROE: 3789's Return on Equity (10.9%) is considered low.


Next Steps

Financial Health

How is Royal Deluxe Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 3789's short term assets (HK$351.4M) exceed its short term liabilities (HK$185.6M).

Long Term Liabilities: 3789's short term assets (HK$351.4M) exceed its long term liabilities (HK$2.4M).


Debt to Equity History and Analysis

Debt Level: 3789's debt to equity ratio (17.6%) is considered satisfactory.

Reducing Debt: 3789's debt to equity ratio has reduced from 24.5% to 17.6% over the past 5 years.

Debt Coverage: 3789's debt is well covered by operating cash flow (132.1%).

Interest Coverage: 3789's interest payments on its debt are well covered by EBIT (9.8x coverage).


Balance Sheet


Next Steps

Dividend

What is Royal Deluxe Holdings's current dividend yield, its reliability and sustainability?

4.12%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 3789's dividend (4.12%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.26%).

High Dividend: 3789's dividend (4.12%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.67%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether 3789's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 3789's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (20%), 3789's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

3.5yrs

Average board tenure


CEO

Lai Chao (53yo)

2.5yrs

Tenure

HK$5,218,000

Compensation

Ms. Chao Lai Heng has been Chief Executive Officer of Royal Deluxe Holdings Ltd. since January 18, 2018. Ms. Chao completed the advanced class of excellent leading in August 2013 and class of chairman of s ...


CEO Compensation Analysis

Compensation vs Market: Lai's total compensation ($USD673.29K) is above average for companies of similar size in the Hong Kong market ($USD230.94K).

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


Board Members

NamePositionTenureCompensationOwnership
Kei Ming Wang
Executive Chairman4yrsHK$17.02m66.8% HK$87.4m
Yu Wang
Executive Director4yrsHK$1.72mno data
Ah Ming Lai
Independent Non-Executive Director3.5yrsHK$180.00kno data
Ping Man Kwong
Independent Non-Executive Director3.5yrsHK$180.00kno data
Kam Sio
Independent Non-Executive Director2.5yrsHK$180.00kno data

3.5yrs

Average Tenure

57yo

Average Age

Experienced Board: 3789's board of directors are considered experienced (3.5 years average tenure).


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.


Ownership Breakdown

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


Top Shareholders

Company Information

Royal Deluxe Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Royal Deluxe Holdings Limited
  • Ticker: 3789
  • Exchange: SEHK
  • Founded: 1994
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$130.800m
  • Shares outstanding: 1.20b
  • Website: https://www.royal-deluxe.com

Number of Employees


Location

  • Royal Deluxe Holdings Limited
  • T G Place
  • Unit A
  • Kwun Tong
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3789SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDFeb 2017

Biography

Royal Deluxe Holdings Limited, an investment holding company, provides formwork erection and related ancillary services in Hong Kong. It undertakes formwork erection works for building construction and civil engineering projects. The company also develops construction technology and related consultancy services. It serves government, public transport operators, and property developers. The Company was founded in 1994 and is headquartered in Kwun Tong, Hong Kong. Royal Deluxe Holdings Limited is a subsidiary of Wang K M Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/10 12:52
End of Day Share Price2020/07/09 00:00
Earnings2020/03/31
Annual Earnings2020/03/31


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.