SEHK:2377

Stock Analysis Report

China Boqi Environmental (Holding)

Executive Summary

China Boqi Environmental (Holding) Co., Ltd., an environment protection company, provides flue gas treatment services in the People's Republic of China and internationally.

Rewards

Trading at 11.5% below its fair value

Revenue is forecast to grow 17% per year

Earnings grew by 18.3% over the past year

Risk Analysis

High level of non-cash earnings

Shareholders have been substantially diluted in the past year

Unstable dividend track record



Snowflake Analysis

Excellent balance sheet, good value and pays a dividend.


Similar Companies

Share Price & News

How has China Boqi Environmental (Holding)'s share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2377 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.8%

2377

3.5%

HK Commercial Services

0.6%

HK Market


1 Year Return

-19.5%

2377

41.7%

HK Commercial Services

-4.5%

HK Market

Return vs Industry: 2377 underperformed the Hong Kong Commercial Services industry which returned 41.2% over the past year.

Return vs Market: 2377 underperformed the Hong Kong Market which returned -3.8% over the past year.


Shareholder returns

2377IndustryMarket
7 Day3.8%3.5%0.6%
30 Day0.7%6.8%-5.2%
90 Day16.2%13.6%2.3%
1 Year-14.4%-19.5%45.0%41.7%-1.0%-4.5%
3 Yearn/a-30.9%-36.0%14.4%2.9%
5 Yearn/a-44.2%-50.1%15.5%-3.8%

Price Volatility Vs. Market

How volatile is China Boqi Environmental (Holding)'s share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China Boqi Environmental (Holding) undervalued compared to its fair value and its price relative to the market?

11.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 2377 (HK$1.36) is trading below our estimate of fair value (HK$1.54)

Significantly Below Fair Value: 2377 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 2377 is good value based on its PE Ratio (5.7x) compared to the Commercial Services industry average (11.9x).

PE vs Market: 2377 is good value based on its PE Ratio (5.7x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2377's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2377 is good value based on its PB Ratio (0.6x) compared to the HK Commercial Services industry average (1.1x).


Next Steps

Future Growth

How is China Boqi Environmental (Holding) forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

17.0%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if 2377's forecast earnings growth is above the savings rate (1.6%).

Earnings vs Market: Insufficient data to determine if 2377's earnings are forecast to grow faster than the Hong Kong market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 2377's revenue (17% per year) is forecast to grow faster than the Hong Kong market (10.5% per year).

High Growth Revenue: 2377's revenue (17% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 2377's Return on Equity is forecast to be low in 3 years time (12.7%).


Next Steps

Past Performance

How has China Boqi Environmental (Holding) performed over the past 5 years?

24.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2377 has a high level of non-cash earnings.

Growing Profit Margin: 2377's current net profit margins (12.1%) are higher than last year (11.5%).


Past Earnings Growth Analysis

Earnings Trend: 2377's earnings have grown significantly by 24.2% per year over the past 5 years.

Accelerating Growth: 2377's earnings growth over the past year (18.3%) is below its 5-year average (24.2% per year).

Earnings vs Industry: 2377 earnings growth over the past year (18.3%) exceeded the Commercial Services industry 14.3%.


Return on Equity

High ROE: 2377's Return on Equity (9.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is China Boqi Environmental (Holding)'s financial position?


Financial Position Analysis

Short Term Liabilities: 2377's short term assets (CN¥2.2B) exceed its short term liabilities (CN¥1.4B).

Long Term Liabilities: 2377's short term assets (CN¥2.2B) exceed its long term liabilities (CN¥24.0M).


Debt to Equity History and Analysis

Debt Level: 2377's debt to equity ratio (6.1%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if 2377's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 2377's debt is well covered by operating cash flow (115.1%).

Interest Coverage: 2377 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 2377 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 2377's debt is covered by short term assets (assets are 16.1x debt).


Next Steps

Dividend

What is China Boqi Environmental (Holding)'s current dividend yield, its reliability and sustainability?

6.45%

Current Dividend Yield


Dividend Yield vs Market

company6.5%marketbottom25%2.3%markettop25%6.4%industryaverage1.5%forecastin3Years5.7%

Current dividend yield vs market & industry

Notable Dividend: 2377's dividend (6.45%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.25%).

High Dividend: 2377's dividend (6.45%) is in the top 25% of dividend payers in the Hong Kong market (6.33%)


Stability and Growth of Payments

Stable Dividend: Too early to tell whether 2377's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 2377's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (36.9%), 2377's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 2377's dividends in 3 years are forecast to be well covered by earnings (20.9% payout ratio).


Next Steps

Management

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

3.0yrs

Average management tenure


CEO

Zhijun Zeng (48yo)

CN¥908,000

Compensation

Mr. Zhijun Zeng serves as the Vice Chairman and Chief Executive Officer of China Boqi Environmental (Holding) Co., Ltd and has been its Executive Director since January 30, 2015. Mr. Zeng is responsible fo ...


CEO Compensation Analysis

Compensation vs Market: Zhijun's total compensation ($USD129.97K) is below average for companies of similar size in the Hong Kong market ($USD284.67K).

Compensation vs Earnings: Zhijun's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Liquan Cheng
Chairman of the Board0yrsCN¥908.00k16.78% CN¥219.7m
Zhijun Zeng
Vice Chairman & CEO0yrsCN¥908.00k21.25% CN¥278.2m
Xiaoping Cao
VP & CFO9.9yrsno datano data
Kongyu Zhang
VP & CTO0yrsno datano data
Xiaoning Qian
VP, Board Secretary & Joint Company Secretary3yrsno datano data
Wai Ling Wong
Joint Company Secretary3yrsno datano data

3.0yrs

Average Tenure

50.5yo

Average Age

Experienced Management: 2377's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Liquan Cheng
Chairman of the Board0yrsCN¥908.00k16.78% CN¥219.7m
Zhijun Zeng
Vice Chairman & CEO0yrsCN¥908.00k21.25% CN¥278.2m
Genyu Liu
Independent Non-Executive Director2yrsno datano data
Guozhong Xie
Independent Non-Executive Director2yrsno datano data
Zhu Weihang
Non-Executive Director3.1yrsno data15.15% CN¥198.3m
Zheng Tuo
Non-Executive Director5.1yrsno datano data
Chen Xue
Non-Executive Director3.1yrsno datano data
Zhifang Lu
Independent Non-Executive Director2yrsno datano data

2.5yrs

Average Tenure

52.5yo

Average Age

Experienced Board: 2377's board of directors are not considered experienced ( 2.5 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 been substantially diluted in the past year, with total shares outstanding growing by 60.4%.


Top Shareholders

Company Information

China Boqi Environmental (Holding) Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China Boqi Environmental (Holding) Co., Ltd.
  • Ticker: 2377
  • Exchange: SEHK
  • Founded: 2015
  • Industry: Environmental and Facilities Services
  • Sector: Commercial Services
  • Market Cap: HK$1.309b
  • Shares outstanding: 1.01b
  • Website: https://www.chinaboqi.com

Number of Employees


Location

  • China Boqi Environmental (Holding) Co., Ltd.
  • R&F Center
  • 11th Floor
  • Beijing
  • 100022
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2377SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDMar 2018

Biography

China Boqi Environmental (Holding) Co., Ltd., an environment protection company, provides flue gas treatment services in the People's Republic of China and internationally. It engages in the project engineering and construction, design, procurement of equipment and materials, equipment installation, and commissioning services related to desulfurization, denitrification, and dust removal for coal-fired power plants. The company also provides operation and maintenance services for desulfurization, denitrification, and dust removal facilities; and technical support, regular maintenance, facilities testing, and spare parts services for flue gas facilities. In addition, it constructs and operates concessions on a BOT basis, as well as provides waste water treatment services to coal-fired power plants. Further, the company sells coal and chemicals; and offers technology and exploration services. China Boqi Environmental (Holding) Co., Ltd., was incorporated in 2015 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 Analysis2020/02/18 13:23
End of Day Share Price2020/02/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.