Top Undervalued Small Caps With Insider Action In Hong Kong For September 2024

As global markets experience volatility and economic indicators point to a potential slowdown, the Hong Kong market has shown resilience, with small-cap stocks presenting unique opportunities. In this environment, identifying undervalued small-cap stocks with insider action can be particularly rewarding for investors seeking growth potential amidst broader market uncertainties.

Top 5 Undervalued Small Caps With Insider Buying In Hong Kong

Name	PE	PS	Discount to Fair Value	Value Rating
Shenzhen International Holdings	5.6x	0.7x	26.50%	★★★★★★
Shanghai Chicmax Cosmetic	15.6x	2.0x	-129.33%	★★★★☆☆
EVA Precision Industrial Holdings	4.6x	0.2x	14.94%	★★★★☆☆
Meilleure Health International Industry Group	25.0x	9.2x	24.72%	★★★☆☆☆
Analogue Holdings	12.5x	0.2x	44.66%	★★★☆☆☆
Skyworth Group	4.7x	0.1x	-139.03%	★★★☆☆☆
Lee & Man Paper Manufacturing	5.8x	0.3x	-18.81%	★★★☆☆☆
CN Logistics International Holdings	19.2x	0.4x	25.52%	★★★☆☆☆
Comba Telecom Systems Holdings	NA	0.6x	36.51%	★★★☆☆☆

Click here to see the full list of 9 stocks from our Undervalued SEHK Small Caps With Insider Buying screener.

Let's dive into some prime choices out of from the screener.

Lee & Man Paper Manufacturing (SEHK:2314)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Lee & Man Paper Manufacturing is a company engaged in the production of packaging and tissue paper, with a market capitalization of HK$16.71 billion.

Operations: The company generates revenue from three primary segments: Packaging Paper, Tissue Paper, and Pulp. Over the observed periods, net income margin has shown a varied trend, with a recent figure of 5.96% as of June 2024.

PE: 5.8x

Lee & Man Paper Manufacturing, a smaller player in Hong Kong's market, recently declared an interim dividend of HK$0.062 per share for the first half of 2024. They reported sales of HK$12.51 billion and net income of HK$805.69 million, significantly up from last year’s figures. Notably, insider confidence is evident with Ho Chung Lee purchasing 483,000 shares worth over HK$1 million in July 2024. The company relies entirely on external borrowing but maintains a positive earnings growth forecast at 5.83% annually.

• Get an in-depth perspective on Lee & Man Paper Manufacturing's performance by reading our valuation report here.

• Evaluate Lee & Man Paper Manufacturing's historical performance by accessing our past performance report.

Comba Telecom Systems Holdings (SEHK:2342)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Comba Telecom Systems Holdings specializes in providing wireless telecommunications network system equipment and services, as well as operator telecommunication services, with a market cap of approximately HK$3.2 billion.

Operations: The company generates revenue primarily from Wireless Telecommunications Network System Equipment and Services (HK$4941.02 million) and Operator Telecommunication Services (HK$156.22 million). For the period ending September 30, 2023, it reported a gross profit margin of 28.23% on a revenue of HK$6266.16 million, with operating expenses totaling HK$1720.19 million and net income at HK$109.36 million resulting in a net income margin of 1.75%.

PE: -11.9x

Comba Telecom Systems Holdings, a small-cap player in Hong Kong, has seen its earnings decline by 1.7% annually over the past five years. Recently, they announced a significant projected loss of HK$160 million for H1 2024 due to delayed telecom projects and lower income from equity investments. Insider confidence is evident with recent share purchases by senior management in June 2024. The company decided against declaring an interim dividend for the six months ending June 30, 2024.

• Click to explore a detailed breakdown of our findings in Comba Telecom Systems Holdings' valuation report.

• Assess Comba Telecom Systems Holdings' past performance with our detailed historical performance reports.

Skyworth Group (SEHK:751)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Skyworth Group is a diversified company engaged in smart household appliances, smart systems technology, modern services, and new energy business with a market cap of approximately HK$7.36 billion.

Operations: Skyworth Group's primary revenue streams include Smart Household Appliances Business (CN¥32.51 billion), New Energy Business (CN¥20.21 billion), Smart Systems Technology Business (CN¥9.84 billion), and Modern Services and Others (CN¥5.80 billion). The company's gross profit margin has shown variability, reaching 14.36% in the most recent period ending June 2024.

PE: 4.7x

Skyworth Group, a smaller player in the Hong Kong market, has shown promising insider confidence with CEO Chi Shi acquiring 2.19 million shares valued at A$6.3 million, reflecting a 16.52% increase in their holdings. For the half-year ending June 30, 2024, Skyworth reported sales of CNY265 million and net income of CNY384 million compared to CNY302 million a year ago. Their expansion into Russia highlights their commitment to innovation and growth despite higher risk funding sources.

• Delve into the full analysis valuation report here for a deeper understanding of Skyworth Group.

• Learn about Skyworth Group's historical performance.

Seize The Opportunity

• Unlock more gems! Our Undervalued SEHK Small Caps With Insider Buying screener has unearthed 6 more companies for you to explore.Click here to unveil our expertly curated list of 9 Undervalued SEHK Small Caps With Insider Buying.
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Contemplating Other Strategies?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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