SEHK:8128

Stock Analysis Report

China Geothermal Industry Development Group

Executive Summary

China Geothermal Industry Development Group Limited, an investment holding company, engages in the field of promoting the geothermal ground source energy as alternative energy for heating in the People’s Republic of China.


Snowflake Analysis

Mediocre balance sheet and overvalued.

Share Price & News

How has China Geothermal Industry Development Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 8128 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

7.8%

8128

0.1%

HK Commercial Services

-0.6%

HK Market


1 Year Return

-40.9%

8128

36.9%

HK Commercial Services

-7.6%

HK Market

Return vs Industry: 8128 underperformed the Hong Kong Commercial Services industry which returned 36.9% over the past year.

Return vs Market: 8128 underperformed the Hong Kong Market which returned -7.6% over the past year.


Shareholder returns

8128IndustryMarket
7 Day7.8%0.1%-0.6%
30 Day-8.3%10.8%-1.4%
90 Day3.8%14.8%2.0%
1 Year-40.9%-40.9%40.1%36.9%-4.2%-7.6%
3 Year-72.4%-75.4%-32.4%-37.4%12.9%1.5%
5 Year-82.6%-84.5%-45.8%-51.5%13.1%-5.6%

Price Volatility Vs. Market

How volatile is China Geothermal Industry Development Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China Geothermal Industry Development Group undervalued compared to its fair value and its price relative to the market?

0.22x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: 8128 (HK$0.06) is trading above our estimate of fair value (HK$0.04)

Significantly Below Fair Value: 8128 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 8128 is unprofitable, so we can't compare its PE Ratio to the Commercial Services industry average.

PE vs Market: 8128 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 8128's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 8128 is good value based on its PB Ratio (0.2x) compared to the HK Commercial Services industry average (1.2x).


Next Steps

Future Growth

How is China Geothermal Industry Development Group forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

28.2%

Forecasted Commercial Services 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 China Geothermal Industry Development Group 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 China Geothermal Industry Development Group performed over the past 5 years?

-60.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8128 is currently unprofitable.

Growing Profit Margin: 8128 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 8128 is unprofitable, and losses have increased over the past 5 years at a rate of -60.8% per year.

Accelerating Growth: Unable to compare 8128's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 8128 is unprofitable, making it difficult to compare its past year earnings growth to the Commercial Services industry (14.3%).


Return on Equity

High ROE: 8128 has a negative Return on Equity (-44.72%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is China Geothermal Industry Development Group's financial position?


Financial Position Analysis

Short Term Liabilities: 8128's short term assets (HK$721.2M) do not cover its short term liabilities (HK$1.3B).

Long Term Liabilities: 8128's short term assets (HK$721.2M) exceed its long term liabilities (HK$135.9M).


Debt to Equity History and Analysis

Debt Level: 8128's debt to equity ratio (43%) is considered high.

Reducing Debt: 8128's debt to equity ratio has increased from 30.6% to 43% over the past 5 years.


Balance Sheet

Inventory Level: 8128 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 8128's debt is covered by short term assets (assets are 1.6x 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 8128 has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: 8128 is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 36.9% per year.


Next Steps

Dividend

What is China Geothermal Industry Development Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 8128's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 8128'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 8128's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8128's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 8128 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 8128'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?

4.8yrs

Average board tenure


CEO

Manquan Wang (56yo)

3.6yrs

Tenure

HK$2,295,000

Compensation

Mr. Manquan Wang has been the Chief Executive Officer of China Ground Source Energy Industry Group Limited since July 13, 2016 and its Executive Director since December 29, 2016. Mr. Wang joined in Ever So ...


CEO Compensation Analysis

Compensation vs Market: Manquan's total compensation ($USD294.70K) is above average for companies of similar size in the Hong Kong market ($USD226.13K).

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


Board Members

NamePositionTenureCompensationOwnership
Shengheng Xu
Joint Chairman & Compliance Officer0yrsHK$3.16m15.74% HK$39.2m
Manquan Wang
CEO & Executive Director3.6yrsHK$2.30m0.016% HK$39.4k
Yiran Zang
CFO & Executive Director6.9yrsHK$1.16mno data
Qi Dai
Executive Director6.5yrsHK$818.00kno data
Wai Kay Chan
Vice Chairman0yrsHK$1.94m1.6% HK$4.0m
Wenzeng Jia
Independent Non-Executive Director10.9yrsHK$150.00kno data
Desheng Wu
Independent Non-Executive Director7.9yrsHK$150.00kno data
Qiang Wu
Independent Non-Executive Director3.2yrsHK$150.00kno data
Qingui Guo
Independent Non-Executive Director3.2yrsHK$150.00kno data
Yan Wang
Joint Chairman1.5yrsHK$2.02mno data

4.8yrs

Average Tenure

56.5yo

Average Age

Experienced Board: 8128's board of directors are considered experienced (4.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: 8128 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

China Geothermal Industry Development Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China Geothermal Industry Development Group Limited
  • Ticker: 8128
  • Exchange: SEHK
  • Founded: 1999
  • Industry: Diversified Support Services
  • Sector: Commercial Services
  • Market Cap: HK$248.981m
  • Shares outstanding: 4.53b
  • Website: https://www.cgsenergy.com.hk

Number of Employees


Location

  • China Geothermal Industry Development Group Limited
  • Units 3709-10
  • 37th Floor
  • Central
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
8128SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDNov 2001

Biography

China Geothermal Industry Development Group Limited, an investment holding company, engages in the field of promoting the geothermal ground source energy as alternative energy for heating in the People’s Republic of China. The company operates through Shallow Geothermal Energy, Air Conditioning Heat Pump, Properties Investment and Development, and Securities Investment and Trading segments. The Shallow Geothermal Energy segment engages in the provision, installation, and maintenance of shallow geothermal energy utilization systems. The Air Conditioning Heat Pump segment trades in air conditioning heat pump products. The Properties Investment and Development segment invests in properties. The Securities Investment and Trading segment invests its funds for trading of securities and other types of investments. The company also provides property management and technical support services; and installs energy systems. The company was formerly known as China Ground Source Energy Industry Group Limited and changed its name to China Geothermal Industry Development Group Limited in May 2018. China Geothermal Industry Development Group Limited was incorporated in 1999 and is headquartered in Central, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 12:49
End of Day Share Price2020/02/21 00:00
Earnings2019/09/30
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.