SEHK:8163

Stock Analysis Report

Executive Summary

Merdeka Financial Group Limited, an investment holding company, engages in trading, financial services, and information technology businesses in the People Republic of China.


Snowflake Analysis

Slightly overvalued with imperfect balance sheet.

Share Price & News

How has Merdeka Financial Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 8163 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.7%

8163

4.8%

HK Consumer Retailing

-0.6%

HK Market


1 Year Return

-77.1%

8163

19.1%

HK Consumer Retailing

-7.6%

HK Market

Return vs Industry: 8163 underperformed the Hong Kong Consumer Retailing industry which returned 19.1% over the past year.

Return vs Market: 8163 underperformed the Hong Kong Market which returned -7.6% over the past year.


Shareholder returns

8163IndustryMarket
7 Day1.7%4.8%-0.6%
30 Day0%10.4%-1.4%
90 Day6.4%13.9%2.0%
1 Year-77.1%-77.1%21.9%19.1%-4.2%-7.6%
3 Year-89.4%-89.4%20.6%13.3%12.9%1.5%
5 Year-95.5%-95.5%40.1%22.8%13.1%-5.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Merdeka Financial Group 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: 8163 (HK$0.12) is trading below our estimate of fair value (HK$61.54)

Significantly Below Fair Value: 8163 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 8163 is unprofitable, so we can't compare its PE Ratio to the Consumer Retailing industry average.

PE vs Market: 8163 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 8163's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 8163 has negative assets, so we can't compare its PB Ratio to the HK Consumer Retailing industry average.


Next Steps

Future Growth

How is Merdeka Financial Group forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

13.5%

Forecasted Consumer Retailing 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 Merdeka Financial 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 Merdeka Financial Group performed over the past 5 years?

26.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8163 is currently unprofitable.

Growing Profit Margin: 8163 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 8163 is unprofitable, but has reduced losses over the past 5 years at a rate of 26% per year.

Accelerating Growth: Unable to compare 8163's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 8163 is unprofitable, making it difficult to compare its past year earnings growth to the Consumer Retailing industry (3.6%).


Return on Equity

High ROE: 8163's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Merdeka Financial Group's financial position?


Financial Position Analysis

Short Term Liabilities: 8163 has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: 8163 has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: 8163 has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: 8163's has negative shareholder equity, so we do not need to check if its debt has reduced over time.


Balance Sheet

Inventory Level: 8163 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 8163 has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


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 8163 has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: 8163 is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 36% per year.


Next Steps

Dividend

What is Merdeka Financial Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 8163's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 8163'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 8163's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8163's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 8163'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?

0.9yrs

Average management tenure


CEO

Wilson Cheung (48yo)

7.5yrs

Tenure

HK$3,918,000

Compensation

Mr. Wai Yin Cheung, also known as Wilson, has been the Chairman, Chief Executive Officer and Compliance Officer at Merdeka Resources Holdings Limited since August 24, 2012. Mr. Cheung served as an Executiv ...


CEO Compensation Analysis

Compensation vs Market: Wilson's total compensation ($USD503.10K) is above average for companies of similar size in the Hong Kong market ($USD226.90K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Wai Yin Cheung
Chairman7.5yrsHK$3.92m0.021% HK$6.4k
Kwai Ping Tsang
Executive Director0.8yrsno datano data
Hei Hau
Company Secretary0.9yrsno datano data

0.9yrs

Average Tenure

Experienced Management: 8163's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Wai Yin Cheung
Chairman7.5yrsHK$3.92m0.021% HK$6.4k
Kwai Ping Tsang
Executive Director0.8yrsno datano data
Mo Sheung Yeung
Independent Non-Executive Director7.3yrsHK$120.00kno data
Ka Sim Ng
Independent Non-Executive Director0.8yrsno datano data
Wing Wong
Independent Non-Executive Director0.3yrsno datano data

0.8yrs

Average Tenure

48yo

Average Age

Experienced Board: 8163'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 been diluted in the past year, with total shares outstanding growing by 2.8%.


Top Shareholders

Company Information

Merdeka Financial Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Merdeka Financial Group Limited
  • Ticker: 8163
  • Exchange: SEHK
  • Founded:
  • Industry: Food Distributors
  • Sector: Consumer Retailing
  • Market Cap: HK$30.157m
  • Shares outstanding: 262.23m
  • Website: https://www.merdeka.com.hk

Number of Employees


Location

  • Merdeka Financial Group Limited
  • Room 1108
  • 11th Floor
  • Central
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
8163SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDMar 2002

Biography

Merdeka Financial Group Limited, an investment holding company, engages in trading, financial services, and information technology businesses in the People Republic of China. Its Trading Business segment trades in goods, components, and accessories; and retails milk powder, dairy products, beauty and cosmetic products, and pharmaceutical OTC products. The company’s Financial Services Business segment provides financial leasing, money lending, asset management, and securities brokerage services; and operates as a book-runner, as well as a lead manager in respect of issuance of debts listed worldwide. Its Information Technology Business segment engages in the distribution of information technology products, and provision of relevant technical support services; developing mobile and cloud based application software; and operating related e-commence platform, as well as franchising a mobile game license. The company’s Other Business segment engages in servicing business, such as training course provision. The company was formerly known as Merdeka Financial Services Group Limited and changed its name to Merdeka Financial Group Limited in October 2019. Merdeka Financial Group Limited is headquartered in Central, Hong Kong. Merdeka Financial Group Limited is a subsidiary of Ivana Investments Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/24 13:07
End of Day Share Price2020/02/24 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.