Shanghai Challenge Textile Co., Ltd. (002486) 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

Shanghai Challenge Textile Co., Ltd.

Why is Shanghai Challenge Textile Co., Ltd. ?

Poor Management Efficiency with a low ROCE of 5.56%

The company has been able to generate a Return on Capital Employed (avg) of 5.56% signifying low profitability per unit of total capital (equity and debt)

The company has declared positive results in Mar'2025 after 2 consecutive negative quarters

NET PROFIT(HY) At CNY 11.62 MM has Grown at 272.73%
NET SALES(HY) At CNY 560.23 MM has Grown at 21.1%
RAW MATERIAL COST(Y) Fallen by -18.8% (YoY)

With ROE of 2.72%, it has a very expensive valuation with a 2.02 Price to Book Value

Over the past year, while the stock has generated a return of 24.60%, its profits have fallen by -39.6%

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Shanghai Challenge Textile Co., Ltd. should be less than 10%
Overall Portfolio exposure to Garments & Apparels should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Garments & Apparels)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Shanghai Challenge Textile Co., Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Shanghai Challenge Textile Co., Ltd.

13.45%

2.13

45.67%

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)

0.61%

EBIT Growth (5y)

-15.72%

EBIT to Interest (avg)

17.68

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.25

Sales to Capital Employed (avg)

1.05

Tax Ratio

7.13%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

5.56%

ROE (avg)

4.33%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

2.02

EV to EBIT

59.33

EV to EBITDA

25.21

EV to Capital Employed

2.37

EV to Sales

1.57

PEG Ratio

Dividend Yield

ROCE (Latest)

3.99%

ROE (Latest)

2.72%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Mildly Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

No Trend

OBV

No Trend

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)

At CNY 11.62 MM has Grown at 272.73%

NET SALES(HY)

At CNY 560.23 MM has Grown at 21.1%

RAW MATERIAL COST(Y)

Fallen by -18.8% (YoY

INVENTORY TURNOVER RATIO(HY)

Highest at 3.9%

DEBTORS TURNOVER RATIO(HY)

Highest at 8.54%

-12What is not working for the Company

NET PROFIT(9M)

At CNY 5.29 MM has Grown at -70.02%

INTEREST(HY)

At CNY 1.13 MM has Grown at 34.99%

OPERATING CASH FLOW(Y)

Lowest at CNY 75.44 MM

NET SALES(Q)

At CNY 266.33 MM has Fallen at -9.47%

Here's what is working for Shanghai Challenge Textile Co., Ltd.

Net Profit

At CNY 9.53 MM has Grown at 99.42%

over average net sales of the previous four periods of CNY 4.78 MM

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Inventory Turnover Ratio

Highest at 3.9%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Debtors Turnover Ratio

Highest at 8.54%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Raw Material Cost

Fallen by -18.8% (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 Shanghai Challenge Textile Co., Ltd.

Interest

At CNY 1.13 MM has Grown at 34.99%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Operating Cash Flow

Lowest at CNY 75.44 MM and Fallen

In each year in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (CNY MM)

Net Sales

At CNY 266.33 MM has Fallen at -9.47%

over average net sales of the previous four periods of CNY 294.2 MM

MOJO Watch

Near term sales trend is negative

Net Sales (CNY MM)