SEHK:1029

Stock Analysis Report

Executive Summary

IRC Limited, an investment holding company, develops, produces, and sells industrial commodities products in the People’s Republic of China and internationally.

Snowflake

Fundamentals

Very undervalued with reasonable growth potential.


Similar Companies

Share Price & News

How has IRC's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0%

1029

-1.9%

HK Metals and Mining

0.3%

HK Market


1 Year Return

48.1%

1029

-16.6%

HK Metals and Mining

-1.5%

HK Market

Return vs Industry: 1029 exceeded the Hong Kong Metals and Mining industry which returned -16.6% over the past year.

Return vs Market: 1029 exceeded the Hong Kong Market which returned -1.5% over the past year.


Shareholder returns

1029IndustryMarket
7 Day0%-1.9%0.3%
30 Day-10.4%-6.1%0.5%
90 Day-41.5%-10.7%-4.4%
1 Year48.1%48.1%-13.6%-16.6%2.1%-1.5%
3 Year-35.8%-35.8%-3.5%-5.8%14.7%3.2%
5 Year-80.3%-80.3%-3.4%-14.3%21.5%1.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is IRC 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: 1029 (HK$0.12) is trading below our estimate of fair value (HK$0.46)

Significantly Below Fair Value: 1029 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1029 is good value based on its PE Ratio (1.9x) compared to the Metals and Mining industry average (10.3x).

PE vs Market: 1029 is good value based on its PE Ratio (1.9x) compared to the Hong Kong market (10.4x).


Price to Earnings Growth Ratio

PEG Ratio: 1029 is good value based on its PEG Ratio (0.1x)


Price to Book Ratio

PB vs Industry: 1029 is good value based on its PB Ratio (0.4x) compared to the HK Metals and Mining industry average (0.7x).


Next Steps

Future Growth

How is IRC forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

22.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1029's forecast earnings growth (22% per year) is above the savings rate (2%).

Earnings vs Market: 1029's earnings (22% per year) are forecast to grow faster than the Hong Kong market (11.2% per year).

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

Revenue vs Market: 1029's revenue (14.9% per year) is forecast to grow faster than the Hong Kong market (10.4% per year).

High Growth Revenue: 1029's revenue (14.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1029's Return on Equity is forecast to be low in 3 years time (12.9%).


Next Steps

Past Performance

How has IRC performed over the past 5 years?

57.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: 1029 has become profitable over the past 5 years, growing earnings by 57.6% per year.

Accelerating Growth: 1029's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1029 had negative earnings growth (-45.4%) over the past year, making it difficult to compare to the Metals and Mining industry average (-24.5%).


Return on Equity

High ROE: 1029's Return on Equity (21.4%) is considered high.


Return on Assets

ROA vs Industry: 1029 has a higher Return on Assets than the Metals and Mining industry average last year.


Return on Capital Employed

ROCE Improving: 1029's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is IRC's financial position?


Financial Position Analysis

Short Term Liabilities: 1029's short term assets ($54.5M) do not cover its short term liabilities ($109.0M)

Long Term Liabilities: 1029's short term assets (54.5M) do not cover its long term liabilities (235.0M)


Debt to Equity History and Analysis

Debt Level: 1029's debt to equity ratio (84.5%) is considered high

Reducing Debt: 1029's debt to equity ratio has increased from 30.3% to 84.5% over the past 5 years.

Debt Coverage: 1029's debt is not well covered by operating cash flow (13.1%).

Interest Coverage: 1029's interest payments on its debt are not well covered by EBIT (0.1x coverage).


Balance Sheet

Inventory Level: 1029 has a high level of physical assets or inventory.

Debt Coverage by Assets: 1029's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is IRC's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.3%markettop25%6.3%industryaverage4.6%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate 1029's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 1029's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if 1029's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 1029'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 1029's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

What is the CEO of IRC's salary, the management and board of directors tenure and is there insider trading?

4.6yrs

Average management tenure


CEO

Yury V. Makarov (44yo)

9.2yrs

Tenure

US$1,072,000

Compensation

Mr. Yury V. Makarov has been the Chief Executive Officer of IRC Limited of Petropavlovsk PLC since August 25, 2010. Mr. Makarov served as Chief Operating Officer of IRC Limited (alternate name, is Aricom P ...


CEO Compensation Analysis

Compensation vs. Market: Yury V.'s total compensation ($USD1.07M) is about average for companies of similar size in the Hong Kong market ($USD216.38K).

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


Management Age and Tenure

4.6yrs

Average Tenure

46.5yo

Average Age

Experienced Management: 1029's management team is considered experienced (4.6 years average tenure).


Board Age and Tenure

8.9yrs

Average Tenure

61.5yo

Average Age

Experienced Board: 1029's board of directors are considered experienced (8.9 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$835,46122 Dec 18
Peter Charles Percival Hambro
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman
Shares15,330,000
Max PriceUS$0.054

Ownership Breakdown


Management Team

  • Yury V. Makarov (44yo)

    CEO & Executive Director

    • Tenure: 9.2yrs
    • Compensation: US$1.07m
  • Danila Kotlyarov (41yo)

    CFO & Executive Director

    • Tenure: 3.8yrs
    • Compensation: US$889.00k
  • Galina Samoylova (71yo)

    Group Head of Technologies

    • Tenure: 0yrs
  • Roman Kazakov (47yo)

    Group Head of Legal & Corporate Affairs

    • Tenure: 0yrs
  • Vladimir Lebedinskiy (62yo)

    Head of Procurement - Russia

    • Tenure: 0yrs
  • Vladimir Mikhailovich (64yo)

    Group Head of Design

    • Tenure: 0yrs
  • Svetlana Obydenkova (42yo)

    Group Head of Health Safety & Environment

    • Tenure: 0yrs
  • Johnny Shiu (46yo)

    Corporate Controller & Company Secretary

    • Tenure: 4.6yrs
  • Kent Lo

    Manager of Communications & Investor Relations

    • Tenure: 0yrs

Board Members

  • Simon Murray (79yo)

    Independent Non-Executive Director

    • Tenure: 8.9yrs
    • Compensation: US$90.00k
  • Peter Charles Percival Hambro (74yo)

    Non-Executive Chairman

    • Tenure: 0.8yrs
    • Compensation: US$42.00k
  • Pavel Maslovskiy (63yo)

    Emeritus Director

    • Tenure: 0yrs
    • Compensation: US$98.00k
  • Daniel Bradshaw (72yo)

    Deputy Chairman & Senior Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$126.00k
  • Yury V. Makarov (44yo)

    CEO & Executive Director

    • Tenure: 9.2yrs
    • Compensation: US$1.07m
  • Danila Kotlyarov (41yo)

    CFO & Executive Director

    • Tenure: 3.8yrs
    • Compensation: US$889.00k
  • Raymond Woo (50yo)

    Independent Non-Executive Director

    • Tenure: 9.3yrs
    • Compensation: US$90.00k
  • Chuang-Fei Li (72yo)

    Independent Non-Executive Director

    • Tenure: 9.1yrs
    • Compensation: US$126.00k
  • Jonathan Martin Smith (60yo)

    Independent Non-Executive Director

    • Tenure: 9.1yrs
    • Compensation: US$126.00k
  • Patrick Cheng (50yo)

    Non-Executive Director

    • Tenure: 2.7yrs
    • Compensation: US$90.00k

Company Information

IRC Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: IRC Limited
  • Ticker: 1029
  • Exchange: SEHK
  • Founded: 2010
  • Industry: Steel
  • Sector: Materials
  • Market Cap: HK$851.206m
  • Shares outstanding: 7.09b
  • Website: https://www.ircgroup.com.hk

Number of Employees


Location

  • IRC Limited
  • 6H, 9 Queen’s Road Central
  • Central
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1029SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDOct 2010
2I8DB (Deutsche Boerse AG)YesOrdinary SharesDEEUROct 2010

Biography

IRC Limited, an investment holding company, develops, produces, and sells industrial commodities products in the People’s Republic of China and internationally. The company operates through four segments:  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 12:51
End of Day Share Price2019/10/22 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.