Lee & Man Chemical Co. Ltd. (0746) AI Stock Analysis

• Market Cap: HK$4.08B
• Dividend Yield: 6.82%
• Average Volume (3M): 224.82K
• Price to Earnings (P/E): 7.2
• Beta (1Y): 0.45
• Revenue Growth: -3.73%
• EPS Growth: 6.09%
• Country: HK
• Employees: 1,930
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals
• EPS (TTM): 0.40
• Shares Outstanding: 825,000,000
• 10 Day Avg. Volume: 198,462
• 30 Day Avg. Volume: 224,820
• PEG Ratio: 0.35
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.78
• P/FCF Ratio: 10.91
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: HK$5.00 ▼(-1.19% Downside)

Lee & Man Chemical Co. Ltd. scores well on valuation due to its low P/E ratio and high dividend yield, making it attractive for value investors. However, technical analysis indicates bearish momentum, which could pose short-term risks. Financial performance is solid but requires attention to revenue growth and free cash flow optimization.

Lee & Man Chemical Co. Ltd. Business Overview & Revenue Model

Company Description

Lee & Man Chemical Company Limited, an investment holding company, manufactures and sells chemical products in the People's Republic of China. It operates through two segments, Chemical and Property. The company offers caustic soda, chloromethane products, polymers, hydrogen peroxide, fluorochemical products, polytetrafluoroethylene, liquified chlorine, and other products, as well as provides styrene acrylic latex surface sizing agent and lithium-ion battery additives. In addition, it is involved in the development, sale, and rental of properties. The company was formerly known as Lee & Man Holding Limited and changed its name to Lee & Man Chemical Company Limited in June 2011. Lee & Man Chemical Company Limited was founded in 1976 and is headquartered in Kwun Tong, Hong Kong.

How the Company Makes Money

Lee & Man Chemical Co. Ltd. generates revenue through the production and sale of its chemical products, which are utilized in various industrial applications. The company's revenue model is primarily based on direct sales to clients in different sectors, including manufacturing and construction. Key revenue streams include the sale of industrial chemicals, adhesives, and specialized chemical formulations. Additionally, the company may engage in long-term contracts with major clients, ensuring consistent demand and stable revenue. Strategic partnerships with suppliers and distributors enhance their market reach, while investments in research and development enable Lee & Man to innovate and expand its product offerings, further contributing to its earnings.

Lee & Man Chemical Co. Ltd. Financial Statement Overview

Summary

Lee & Man Chemical Co. Ltd. demonstrates a balanced financial profile with robust operational efficiency and solid balance sheet strength. While income and revenue trends have been inconsistent, the company maintains strong profit margins and cash generation capabilities. Future growth may require addressing revenue challenges and optimizing free cash flow.

Income Statement

Lee & Man Chemical Co. Ltd. has shown a mixed performance in recent years. The gross profit margin has remained relatively strong, indicating effective cost management. However, there has been a decline in both revenue and net income in recent periods, with a notable revenue drop from 2022 to 2023. Despite this, the company maintains a healthy EBIT and EBITDA margin, suggesting operational efficiency.

Balance Sheet

The company's balance sheet reflects strong equity levels and a conservative debt-to-equity ratio, suggesting financial stability and lower leverage risk. The equity ratio is robust, indicating a solid capital structure with significant asset backing. Overall, Lee & Man Chemical Co. Ltd. appears financially sound in terms of its balance sheet metrics.

Cash Flow

The cash flow statement highlights a strong operating cash flow, which is a positive indicator of the company's ability to generate cash from its core operations. However, free cash flow has shown variability, which could impact investment flexibility. The operating cash flow to net income ratio is favorable, but attention to free cash flow growth is needed to sustain long-term financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.93B	3.95B	4.05B	5.87B	5.19B	3.10B
Gross Profit	939.52M	1.16B	1.06B	2.12B	2.34B	1.13B
EBITDA	444.92M	693.50M	597.02M	1.51B	1.72B	743.82M
Net Income	405.51M	482.28M	400.67M	1.16B	1.29B	502.63M
Balance Sheet
Total Assets	7.32B	7.20B	7.03B	7.08B	7.62B	6.78B
Cash, Cash Equivalents and Short-Term Investments	282.75M	290.66M	263.67M	421.70M	324.88M	422.68M
Total Debt	487.74M	653.06M	678.91M	746.46M	1.04B	1.54B
Total Liabilities	1.08B	1.26B	1.23B	1.44B	2.04B	2.34B
Stockholders Equity	6.23B	5.94B	5.80B	5.63B	5.57B	4.44B
Cash Flow
Free Cash Flow	293.95M	282.02M	142.21M	955.86M	762.12M	348.55M
Operating Cash Flow	741.42M	1.06B	756.45M	1.57B	1.43B	827.06M
Investing Cash Flow	-760.78M	-826.47M	-613.69M	-610.62M	-636.18M	-476.20M
Financing Cash Flow	-242.78M	-265.43M	-298.37M	-840.28M	-919.87M	-253.94M

Lee & Man Chemical Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.06
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0746, the sentiment is Positive. The current price of 5.06 is above the 20-day moving average (MA) of 4.84, above the 50-day MA of 5.06, and above the 200-day MA of 4.12, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 57.18 is Neutral, neither overbought nor oversold. The STOCH value of 76.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0746.

Lee & Man Chemical Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1702	70 Outperform	HK$1.21B	16.88	3.61%	1.85%	-8.51%	-68.34%
0746	69 Neutral	HK$4.08B	7.18	9.36%	6.82%	-3.73%	6.09%
2198	64 Neutral	HK$2.78B	3.69	13.87%	―	9.20%	213.87%
0189	62 Neutral	HK$16.23B	11.74	10.43%	0.93%	-1.43%	113.67%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
1907	54 Neutral	HK$10.29B	-145.28	-0.52%	1.06%	-15.17%	-125.24%
0609	54 Neutral	HK$1.22B	18.94	2.46%	3.68%	-5.29%	-32.47%

Lee & Man Chemical Co. Ltd. Corporate Events

Lee & Man Chemical Updates on 2024 Annual Report and Share Option Scheme

Lee & Man Chemical Co. Ltd. has released a supplemental announcement regarding its 2024 Annual Report, providing additional information on its Share Option Scheme. The company has fully utilized the scheme mandate, with no options available for grant as of January 1 and December 31, 2024. The scheme allows participation from directors, employees, and various stakeholders who contribute to the group. The total shares available for issue under the scheme represent 10% of the total issued shares. This announcement ensures compliance with the Listing Rules and clarifies the operational aspects of the Share Option Scheme, potentially impacting stakeholders’ engagement with the company.

The most recent analyst rating on (HK:0746) stock is a Buy with a HK$5.50 price target. To see the full list of analyst forecasts on Lee & Man Chemical Co. Ltd. stock, see the HK:0746 Stock Forecast page.

Lee & Man Chemical Announces Land Use Rights Transfer in Changshu

Lee & Man Chemical Co. Ltd. has announced a connected transaction involving the transfer of land use rights in Changshu, China. Jiangsu Paper and Jiangsu Chemical, subsidiaries of Lee & Man Paper and Lee & Man Chemical respectively, have entered into a contract for the transfer of these rights for approximately RMB67.53 million. This transaction, categorized under Chapter 14A of the Listing Rules, is subject to reporting and announcement requirements but is exempt from shareholder approval. The land, designated for industrial use, spans approximately 74,937 square meters, and the payment will be made in three installments.

Lee & Man Chemical Announces Forfeiture of Unclaimed Dividends

Lee & Man Chemical Co. Ltd. has announced the forfeiture of unclaimed dividends from 2018 and 2019, which will revert to the company if not claimed by September 15, 2025. Shareholders are advised to contact the company’s registrar to claim their dividends, highlighting the company’s adherence to its Articles of Association and impacting shareholder relations.

Lee & Man Chemical Reports 36% Profit Increase Amid Cost Reductions

Lee & Man Chemical Company Limited reported a significant 36% increase in profit to HK$327 million for the first half of 2025, driven by reduced energy costs and lower raw material prices. The company’s gross profit margin improved by 7.4 percentage points to 36.3%, and it proposed an interim dividend of HK19.5 cents per share, up from HK14 cents in the previous year, indicating strong financial performance and positive implications for stakeholders.

Lee & Man Chemical Announces Interim Dividend for 2025

Lee & Man Chemical Co. Ltd. has announced an interim cash dividend of HKD 0.195 per share for the six months ended 30 June 2025, with the payment date set for 09 September 2025. This announcement reflects the company’s financial performance and commitment to returning value to shareholders, potentially enhancing its market position and stakeholder confidence.