Hunan Zhenghong Science & Technology Development Co., Ltd. (000702) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Hunan Zhenghong Science & Technology Development Co., Ltd.

Why is Hunan Zhenghong Science & Technology Development Co., Ltd. ?

Poor Management Efficiency with a low ROCE of 0.53%

The company has been able to generate a Return on Capital Employed (avg) of 0.53% signifying low profitability per unit of total capital (equity and debt)

High Debt Company with a Debt to Equity ratio (avg) at times

Poor long term growth as Net Sales has grown by an annual rate of 5.53% and Operating profit at -200.58% over the last 5 years
High Debt Company with a Debt to Equity ratio (avg) at times
The company has been able to generate a Return on Equity (avg) of 0.97% signifying low profitability per unit of shareholders funds

Poor long term growth as Net Sales has grown by an annual rate of 5.53% and Operating profit at -200.58% over the last 5 years

Risky -

The stock is trading risky as compared to its average historical valuations
Over the past year, while the stock has generated a return of -14.99%, its profits have risen by 45.3%

Below par performance in long term as well as near term

Along with generating -14.99% returns in the last 1 year, the stock has also underperformed China Shanghai Composite in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Other Agricultural Products)

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is Hunan Zhenghong Science & Technology Development Co., Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Hunan Zhenghong Science & Technology Development Co., Ltd.

-20.19%

1.13

48.07%

China Shanghai Composite

14.77%

1.01

15.10%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

5.53%

EBIT Growth (5y)

-200.58%

EBIT to Interest (avg)

-4.53

Debt to EBITDA (avg)

Negative Net Debt

Net Debt to Equity (avg)

0.22

Sales to Capital Employed (avg)

1.78

Tax Ratio

0.05%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

0.53%

ROE (avg)

0.97%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

NA (Loss Making)

Industry P/E

Price to Book Value

5.38

EV to EBIT

-77.47

EV to EBITDA

309.95

EV to Capital Employed

4.96

EV to Sales

1.65

PEG Ratio

Dividend Yield

ROCE (Latest)

-6.40%

ROE (Latest)

-8.66%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bullish

Bollinger Bands

Bearish

Mildly Bullish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bearish

Mildly Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

12What is working for the Company

NET PROFIT(HY)

Higher at CNY -52.22 MM

ROCE(HY)

Highest at -17.02%

INVENTORY TURNOVER RATIO(HY)

Highest at 13.18%

RAW MATERIAL COST(Y)

Fallen by -8.75% (YoY

CASH AND EQV(HY)

Highest at CNY 491.15 MM

-10What is not working for the Company

INTEREST(HY)

At CNY 5.86 MM has Grown at 35.07%

NET SALES(Q)

At CNY 201.61 MM has Fallen at -27.82%

DEBTORS TURNOVER RATIO(HY)

Lowest at 18.55%

OPERATING PROFIT MARGIN(Q)

Lowest at -2.72 %

Here's what is working for Hunan Zhenghong Science & Technology Development Co., Ltd.

Net Profit

Higher at CNY -52.22 MM

than preceding 12 month period ended Mar 2025

MOJO Watch

In the half year the company has already crossed Net Profit of the previous twelve months

Net Profit (CNY MM)

Net Profit

At CNY -52.22 MM has Grown at 44.4%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Inventory Turnover Ratio

Highest at 13.18% and Grown

In each half year in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Cash and Eqv

Highest at CNY 491.15 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Raw Material Cost

Fallen by -8.75% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Hunan Zhenghong Science & Technology Development Co., Ltd.

Interest

At CNY 5.86 MM has Grown at 35.07%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Net Sales

At CNY 201.61 MM has Fallen at -27.82%

over average net sales of the previous four periods of CNY 279.32 MM

MOJO Watch

Near term sales trend is extremely negative

Net Sales (CNY MM)

Debtors Turnover Ratio

Lowest at 18.55% and Fallen

In each half year in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio

Operating Profit Margin

Lowest at -2.72 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales