SEHK Value Stocks Priced Below Intrinsic Estimates In October 2024

The Hong Kong stock market has experienced a significant boost recently, driven by China's robust stimulus measures aimed at revitalizing its economy. This positive sentiment has led to a notable rally in the Hang Seng Index, reflecting increased investor confidence. In this context, identifying undervalued stocks—those priced below their intrinsic estimates—can present unique opportunities for investors looking to capitalize on market inefficiencies.

Top 10 Undervalued Stocks Based On Cash Flows In Hong Kong

Name	Current Price	Fair Value (Est)	Discount (Est)
BYD Electronic (International) (SEHK:285)	HK$32.55	HK$64.37	49.4%
Giant Biogene Holding (SEHK:2367)	HK$50.95	HK$97.86	47.9%
Alibaba Health Information Technology (SEHK:241)	HK$5.35	HK$10.01	46.6%
XD (SEHK:2400)	HK$25.50	HK$47.73	46.6%
China Ruyi Holdings (SEHK:136)	HK$2.26	HK$4.15	45.6%
Shanghai INT Medical Instruments (SEHK:1501)	HK$28.70	HK$56.39	49.1%
Zylox-Tonbridge Medical Technology (SEHK:2190)	HK$13.00	HK$25.92	49.9%
Digital China Holdings (SEHK:861)	HK$2.96	HK$5.85	49.4%
Akeso (SEHK:9926)	HK$68.60	HK$134.06	48.8%
Hua Hong Semiconductor (SEHK:1347)	HK$20.90	HK$38.48	45.7%

Click here to see the full list of 39 stocks from our Undervalued SEHK Stocks Based On Cash Flows screener.

Underneath we present a selection of stocks filtered out by our screen.

China Ruyi Holdings (SEHK:136)

Overview: China Ruyi Holdings Limited is an investment holding company involved in content production and online streaming across China, Hong Kong, Europe, and internationally, with a market cap of HK$28.26 billion.

Operations: The company generates revenue primarily from its content production business, which brought in CN¥1.63 billion, and its online streaming and gaming businesses, which contributed CN¥3.01 billion.

Estimated Discount To Fair Value: 45.6%

China Ruyi Holdings is trading at HK$2.26, significantly below its estimated fair value of HK$4.15, indicating potential undervaluation based on cash flows. Despite a net loss of CNY 114.65 million for the recent half-year, the company’s earnings are forecast to grow 17.57% annually, outpacing the Hong Kong market's 12.2%. However, profit margins have declined from 25.8% to 18%, and shareholders faced dilution over the past year.

• Insights from our recent growth report point to a promising forecast for China Ruyi Holdings' business outlook.
• Unlock comprehensive insights into our analysis of China Ruyi Holdings stock in this financial health report.

AAC Technologies Holdings (SEHK:2018)

Overview: AAC Technologies Holdings Inc. is an investment holding company that provides solutions for smart devices across various regions including Mainland China, Hong Kong, Taiwan, other Asian countries, the United States, and Europe with a market cap of HK$38.23 billion.

Operations: The company's revenue segments are as follows: Optics Products (CN¥4.07 billion), Acoustics Products (CN¥7.64 billion), Sensor and Semiconductor Products (CN¥920.28 million), and Electromagnetic Drives and Precision Mechanics (CN¥8.28 billion).

Estimated Discount To Fair Value: 11.1%

AAC Technologies Holdings reported a substantial increase in net income to CNY 537.03 million for H1 2024, compared to CNY 150.3 million the previous year, with earnings per share rising significantly. The stock is trading at HK$31.9, slightly below its estimated fair value of HK$35.9, indicating potential undervaluation based on cash flows. However, despite strong earnings growth forecasts of over 20% annually, revenue growth is expected to be moderate at around 11.9%.

• In light of our recent growth report, it seems possible that AAC Technologies Holdings' financial performance will exceed current levels.
• Click here and access our complete balance sheet health report to understand the dynamics of AAC Technologies Holdings.

Bosideng International Holdings (SEHK:3998)

Overview: Bosideng International Holdings Limited operates in the apparel business in the People’s Republic of China and has a market cap of HK$48.85 billion.

Operations: The company's revenue segments in millions of CN¥ are as follows: Down Apparels: 19.54 billion, Ladieswear Apparels: 819.80 million, Diversified Apparels: 235.33 million, and Original Equipment Manufacturing (OEM) Management: 2.70 billion.

Estimated Discount To Fair Value: 34.7%

Bosideng International Holdings is trading at HK$4.46, significantly below its estimated fair value of HK$6.83, indicating it may be undervalued based on cash flows. The company has seen a 43.7% earnings growth over the past year and is expected to grow revenue by 11% annually, outpacing the Hong Kong market's 7.3%. Despite an unstable dividend track record, Bosideng recently approved a final dividend of 20 HK cents per share at its AGM in August 2024.

• The analysis detailed in our Bosideng International Holdings growth report hints at robust future financial performance.
• Click to explore a detailed breakdown of our findings in Bosideng International Holdings' balance sheet health report.

Summing It All Up

• Reveal the 39 hidden gems among our Undervalued SEHK Stocks Based On Cash Flows screener with a single click here.
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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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