SEHK:488

Stock Analysis Report

Executive Summary

Lai Sun Development Company Limited, together with its subsidiaries, invests in, develops, leases, and sells real estate properties in Hong Kong, Mainland China, the United Kingdom, Vietnam, and internationally.


Snowflake Analysis

Fair value with questionable track record.


Similar Companies

Share Price & News

How has Lai Sun Development's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 488's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

3.8%

488

5.4%

HK Real Estate

4.0%

HK Market


1 Year Return

-37.2%

488

-26.2%

HK Real Estate

-20.1%

HK Market

Return vs Industry: 488 underperformed the Hong Kong Real Estate industry which returned -26.2% over the past year.

Return vs Market: 488 underperformed the Hong Kong Market which returned -20.1% over the past year.


Shareholder returns

488IndustryMarket
7 Day3.8%5.4%4.0%
30 Day-16.2%-13.4%-11.3%
90 Day-19.7%-18.9%-15.6%
1 Year-36.6%-37.2%-22.8%-26.2%-17.2%-20.1%
3 Year-14.8%-17.0%15.5%3.0%-2.9%-12.7%
5 Year6.4%-4.0%33.9%11.1%-6.8%-21.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Lai Sun Development undervalued compared to its fair value and its price relative to the market?

1.04x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 488 (HK$8.3) is trading above our estimate of fair value (HK$1.38)

Significantly Below Fair Value: 488 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 488 is good value based on its PE Ratio (1x) compared to the Real Estate industry average (6.3x).

PE vs Market: 488 is good value based on its PE Ratio (1x) compared to the Hong Kong market (9x).


Price to Earnings Growth Ratio

PEG Ratio: 488's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: 488 is good value based on its PB Ratio (0.1x) compared to the HK Real Estate industry average (0.4x).


Next Steps

Future Growth

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

-134.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 488's earnings are forecast to decline over the next 3 years (-134.2% per year).

Earnings vs Market: 488's earnings are forecast to decline over the next 3 years (-134.2% per year).

High Growth Earnings: 488's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 488's revenue is expected to decline over the next 3 years (-14.2% per year).

High Growth Revenue: 488's revenue is forecast to decline over the next 3 years (-14.2% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 488's Return on Equity is forecast to be low in 3 years time (0.5%).


Next Steps

Past Performance

How has Lai Sun Development performed over the past 5 years?

33.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 488 has a large one-off gain of HK$4.2B impacting its July 31 2019 financial results.

Growing Profit Margin: 488's current net profit margins (74.6%) are lower than last year .


Past Earnings Growth Analysis

Earnings Trend: 488's earnings have grown significantly by 33.9% per year over the past 5 years.

Accelerating Growth: 488's earnings growth over the past year (11.7%) is below its 5-year average (33.9% per year).

Earnings vs Industry: 488 earnings growth over the past year (11.7%) exceeded the Real Estate industry -2.9%.


Return on Equity

High ROE: 488's Return on Equity (9.8%) is considered low.


Next Steps

Financial Health

How is Lai Sun Development's financial position?


Financial Position Analysis

Short Term Liabilities: 488's short term assets (HK$13.5B) exceed its short term liabilities (HK$9.5B).

Long Term Liabilities: 488's short term assets (HK$13.5B) do not cover its long term liabilities (HK$20.8B).


Debt to Equity History and Analysis

Debt Level: 488's debt to equity ratio (39.9%) is considered satisfactory.

Reducing Debt: 488's debt to equity ratio has increased from 25.5% to 39.9% over the past 5 years.

Debt Coverage: 488's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: 488's interest payments on its debt are not well covered by EBIT (0.9x coverage).


Balance Sheet

Inventory Level: 488 has a high level of physical assets or inventory.

Debt Coverage by Assets: 488's debt is not covered by short term assets (assets are 0.7x debt).


Next Steps

Dividend

What is Lai Sun Development's current dividend yield, its reliability and sustainability?

1.30%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 488's dividend (1.3%) isn’t notable compared to the bottom 25% of dividend payers in the Hong Kong market (2.67%).

High Dividend: 488's dividend (1.3%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.33%).


Stability and Growth of Payments

Stable Dividend: 488 is not paying a notable dividend for the Hong Kong market, therefore no need to check if payments are stable.

Growing Dividend: 488 is not paying a notable dividend for the Hong Kong market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: 488 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 488'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?

7.0yrs

Average management tenure


CEO

Julius Lau (63yo)

14.33s

Tenure

HK$5,296,000

Compensation

Mr. Shu Yan Lau, also known as Julius, has been the Chief Executive Officer of Lai Sun Development Co. Ltd. since November 1, 2005 and served as its Chairman since December 20, 2011. Mr. Lau has more than  ...


CEO Compensation Analysis

Compensation vs Market: Julius's total compensation ($USD683.22K) is above average for companies of similar size in the Hong Kong market ($USD493.10K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Kin Ngok Lam
Executive Chairman of the Board42.75yrsHK$31.09m0.071% HK$3.6m
Shu Yan Lau
CEO & Director14.33yrsHK$5.30m0.043% HK$2.2m
Fook Aun Chew
Executive Deputy Chairman of the Board7.75yrsHK$18.43m0.066% HK$3.3m
Hau Yin Lam
Executive Director7.33yrsHK$3.67mno data
Abi Tsang
Deputy Financial Controllerno datano datano data
Kwanyee Tam
SVP Group Corporate & Investor Relationsno datano datano data
Seng Yum Tham
Executive Director0.58yrno datano data
Kwok Wor Chow
Company Secretary7yrsno datano data

7.0yrs

Average Tenure

57yo

Average Age

Experienced Management: 488's management team is seasoned and experienced (7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kin Ngok Lam
Executive Chairman of the Board42.75yrsHK$31.09m0.071% HK$3.6m
Shu Yan Lau
CEO & Director14.33yrsHK$5.30m0.043% HK$2.2m
Fook Aun Chew
Executive Deputy Chairman of the Board7.75yrsHK$18.43m0.066% HK$3.3m
Hau Yin Lam
Executive Director7.33yrsHK$3.67mno data
Seng Yum Tham
Executive Director0.58yrno datano data
Bing Lam
Independent Non-Executive Director17.67yrsHK$600.00kno data
Kin Ming Lam
Non-Executive Director60.75yrsHK$1.39mno data
Shu Leung
Independent Non-Executive Director15.5yrsHK$300.00kno data
Po Chu U
Non-Executive Director26.25yrsHK$4.53m0.0044% HK$223.4k
Shu Kwan Ip
Independent Non-Executive Director10.25yrsHK$300.00kno data

16.6yrs

Average Tenure

65.5yo

Average Age

Experienced Board: 488's board of directors are seasoned and experienced ( 16.6 years average tenure).


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 not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lai Sun Development Company Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lai Sun Development Company Limited
  • Ticker: 488
  • Exchange: SEHK
  • Founded:
  • Industry: Diversified Real Estate Activities
  • Sector: Real Estate
  • Market Cap: HK$5.065b
  • Shares outstanding: 610.27m
  • Website: https://www.laisun.com/lai-sun-development/en-US

Number of Employees


Location

  • Lai Sun Development Company Limited
  • AIA Central
  • 19th Floor
  • Central
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
488SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJan 1992
LVSD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992

Biography

Lai Sun Development Company Limited, together with its subsidiaries, invests in, develops, leases, and sells real estate properties in Hong Kong, Mainland China, the United Kingdom, Vietnam, and internationally. It operates through Property Development and Sales; Property Investment; Hotel Operation; Restaurant Operation; Media and Entertainment; Film Production and Distribution; Cinema; and Others segments. The company also invests in, develops, operates in, and manages hotels and restaurants, cultural, leisure, entertainment, and related facilities; and provides management and consultancy services to hotels, serviced apartments, and restaurants. In addition, it engages in the development, operation, and investment of media, entertainment, and music production and distribution, as well as provides related advertising services; and cinema operations. Further, the company invests in, produces, licenses, and distributes television programmes, films, and video format products. Additionally, the company offers property management, real estate agency, leasing agency, performance agency, and building services; and luxury yachts brokerage, charter, marketing, management, and crew placement services; and finance and treasury services, as well as engages in golf apparel retailing. It also provides artiste management services; sells albums; distributes and licenses music; and trades in gaming products. In addition, the company distributes movie video compact discs, digital video discs, and Blu-ray discs. Further, it engages in film library management; video duplication services; and translating and subtitling of television programmes. The company is headquartered in Central, Hong Kong. Lai Sun Development Company Limited is a subsidiary of Lai Sun Garment (International) Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 12:46
End of Day Share Price2020/03/27 00:00
Earnings2019/07/31
Annual Earnings2019/07/31


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.