SEHK:2718

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Shanghai Dongzheng Automotive Finance

Executive Summary

Shanghai Dongzheng Automotive Finance Co., Ltd.


Snowflake Analysis

Undervalued with imperfect balance sheet.

Share Price & News

How has Shanghai Dongzheng Automotive Finance's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2718's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.7%

2718

2.4%

HK Consumer Finance

1.4%

HK Market


1 Year Return

-70.8%

2718

-23.8%

HK Consumer Finance

-9.9%

HK Market

Return vs Industry: 2718 underperformed the Hong Kong Consumer Finance industry which returned -23.8% over the past year.

Return vs Market: 2718 underperformed the Hong Kong Market which returned -9.9% over the past year.


Shareholder returns

2718IndustryMarket
7 Day-1.7%2.4%1.4%
30 Day-9.5%0.9%-3.7%
90 Day-28.7%-2.9%-7.8%
1 Year-68.4%-70.8%-21.2%-23.8%-6.9%-9.9%
3 Yearn/a-19.1%-27.6%-4.8%-14.4%
5 Yearn/a-57.4%-64.1%-15.2%-28.3%

Price Volatility Vs. Market

How volatile is Shanghai Dongzheng Automotive Finance's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Shanghai Dongzheng Automotive Finance 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: 2718 (HK$0.57) is trading below our estimate of fair value (HK$1.2)

Significantly Below Fair Value: 2718 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 2718 is good value based on its PE Ratio (2.7x) compared to the Consumer Finance industry average (5.7x).

PE vs Market: 2718 is good value based on its PE Ratio (2.7x) compared to the Hong Kong market (9.3x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2718's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2718 is good value based on its PB Ratio (0.3x) compared to the HK Consumer Finance industry average (0.4x).


Next Steps

Future Growth

How is Shanghai Dongzheng Automotive Finance forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

10.4%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if 2718's forecast earnings growth is above the savings rate (1.6%).

Earnings vs Market: Insufficient data to determine if 2718'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: 2718's revenue (10.4% per year) is forecast to grow slower than the Hong Kong market (10.5% per year).

High Growth Revenue: 2718's revenue (10.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 2718's Return on Equity is forecast to be low in 3 years time (8.9%).


Next Steps

Past Performance

How has Shanghai Dongzheng Automotive Finance performed over the past 5 years?

-13.9%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: 2718 has a high level of non-cash earnings.

Growing Profit Margin: 2718's current net profit margins (65.5%) are lower than last year (66%).


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if 2718's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: 2718's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 2718 had negative earnings growth (-13.9%) over the past year, making it difficult to compare to the Consumer Finance industry average (-8.4%).


Return on Equity

High ROE: 2718's Return on Equity (9.7%) is considered low.


Next Steps

Financial Health

How is Shanghai Dongzheng Automotive Finance's financial position?


Financial Position Analysis

Short Term Liabilities: 2718's short term assets (CN¥10.2B) exceed its short term liabilities (CN¥309.0M).

Long Term Liabilities: 2718's short term assets (CN¥10.2B) exceed its long term liabilities (CN¥6.0B).


Debt to Equity History and Analysis

Debt Level: 2718's debt to equity ratio (148.8%) is considered high.

Reducing Debt: Insufficient data to determine if 2718's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 2718's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: Insufficient data to determine if 2718's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is Shanghai Dongzheng Automotive Finance's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 2718's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 2718's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 2718's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 2718's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 2718 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 2718'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?

2.0yrs

Average board tenure


CEO

Yi Li (46yo)

3yrs

Tenure

Mr. Yi Li serves as President of Shanghai Dongzheng Automotive Finance Co., Ltd. since May 2017. He served as the Chief Operating Officer of China Zhengtong Auto Services Holdings Limited from July 2012 to ...


Board Members

NamePositionTenureCompensationOwnership
Fan Lin
Chairmanno datano datano data
Yongjun Shao
Executive Directorno datano datano data
Man Chung Wong
Independent Non-Executive Director0.17yrno datano data
Yanjun Liang
Independent Non-Executive Directorno datano datano data
Huihua Liu
Chairman of the Board of Supervisors2yrsno datano data
Zheying Lin
Independent Non-Executive Directorno datano datano data
Tee Choong Koh
Non-Executive Directorno datano datano data
Guozhou Li
Non-Executive Director0.58yrno datano data
Tao Li
Supervisor2yrsno datano data
Qing Wang
Employee Representative Supervisor2yrsno datano data

2.0yrs

Average Tenure

49yo

Average Age

Experienced Board: 2718's board of directors are not considered experienced ( 2 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.


Ownership Breakdown

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


Top Shareholders

Company Information

Shanghai Dongzheng Automotive Finance Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Shanghai Dongzheng Automotive Finance Co., Ltd.
  • Ticker: 2718
  • Exchange: SEHK
  • Founded: 2015
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: HK$1.220b
  • Shares outstanding: 2.14b
  • Website: https://www.dongzhengafc.com

Number of Employees


Location

  • Shanghai Dongzheng Automotive Finance Co., Ltd.
  • Mirae Asset Tower
  • Unit ABC
  • Shanghai
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2718SEHK (The Stock Exchange of Hong Kong Ltd.)YesDomestic SharesHKHKDApr 2019
2XKDB (Deutsche Boerse AG)YesDomestic SharesDEEURApr 2019

Biography

Shanghai Dongzheng Automotive Finance Co., Ltd. operates as an auto finance company in the People’s Republic of China. The company operates through Retail Business, Dealer’s Loan Business, and Others segments. It offers retail loan; and loan facilitation, joint loan arrangement, direct lease, and other financial services. The company also provides loans to automobile dealers to facilitate their purchase of vehicles and accessories. As of December 31, 2019, it had a network of 913 dealers covering approximately 172 cities. The company was founded in 2015 and is headquartered in Shanghai, China. Shanghai Dongzheng Automotive Finance Co., Ltd. is a subsidiary of China ZhengTong Auto Services Holdings Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/31 13:52
End of Day Share Price2020/05/29 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.