China Sanjiang Fine Chemicals Co., Ltd. (2198) AI Stock Analysis

• Market Cap: HK$2.49B
• Dividend Yield: N/A
• Average Volume (3M): 3.13M
• Price to Earnings (P/E): 3.5
• Beta (1Y): 0.47
• Revenue Growth: 9.20%
• EPS Growth: 213.87%
• Country: HK
• Employees: 1,430
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals
• EPS (TTM): 0.28
• Shares Outstanding: 1,189,000,000
• 10 Day Avg. Volume: 5,348,800
• 30 Day Avg. Volume: 3,125,900
• PEG Ratio: <0.01
• Price to Book (P/B): 0.37
• Price to Sales (P/S): 0.09
• P/FCF Ratio: -4.58
• 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: HK$2.50
• Price Target Upside: 9.65% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 66 Neutral
• Price Target: HK$2.50 ▲(9.65% Upside)

The overall stock score is driven by strong technical momentum and attractive valuation, despite weak financial performance. The stock's upward trend and low P/E ratio are significant positives, but financial stability concerns due to high leverage and weak cash flow generation weigh on the score.

China Sanjiang Fine Chemicals Co., Ltd. Business Overview & Revenue Model

Company Description

China Sanjiang Fine Chemicals Company Limited, an investment holding company, manufactures and supplies ethylene oxide and glycol, propylene, polypropylene, methyl tert-butyl ether (MTBE), and surfactants in the People's Republic of China. Its ethylene oxide is used as an intermediary component for the production of ethylene derivative products that include ethanolamines and glycol ethers, and a range of surfactants; ethylene glycol is used to produce other bio-organic chemical products that comprise mono ethylene glycol; propylene is used in the production of polypropylene, acrylonitrile, propylene oxide, acetone, etc.; polypropylene is a thermoplastic resin used in knitting, injection molding, film, fiber, and pipe products; MTBE, a gasoline additive used as an oxygenate to raise the octane number and used as a fuel component in fuel for gasoline engines; and surfactants are applied in various industries as scouring agents, moisturizing agents, emulsifiers, and solubilisers. The company also produces and supplies other chemical products, such as carbon four; crude pentene; and industrial gases, such as oxygen, nitrogen, and argon. In addition, it offers processing services for polypropylene, MTBE, and surfactants; and lease and storage services, as well as provides asset management and supply chain management services. Further, the company is involved in the construction and management of a pipe network at Jiaxing Port Chemical Industrial Park; manufacture and sale of fertilisers, plastics, alcohol ethoxylate, nonylphenols, textile auxiliaries, and polyethylene; and equipment rental. China Sanjiang Fine Chemicals Company Limited was incorporated in 2009 and is headquartered in Jiaxing, the People's Republic of China.

How the Company Makes Money

China Sanjiang Fine Chemicals Co., Ltd. generates revenue primarily through the production and sale of ethylene oxide and ethylene glycol, which serve as key raw materials in various industries. The company's revenue model is centered around large-scale manufacturing and distribution of these chemicals to industrial clients. Key revenue streams include contracts with manufacturers in the automotive, textile, and consumer goods sectors. Additionally, strategic partnerships with suppliers and distributors help optimize its supply chain and expand its market reach. The company's earnings are significantly influenced by global demand for its chemical products, price fluctuations in raw materials, and operational efficiencies in its production processes.

China Sanjiang Fine Chemicals Co., Ltd. Financial Statement Overview

Summary

China Sanjiang Fine Chemicals exhibits mixed financial health. While revenue growth shows positive signs, profitability and cash flow generation remain weak. High leverage and diminishing equity ratios pose risks to financial stability. The company needs to address these issues to enhance overall financial performance.

Income Statement

China Sanjiang Fine Chemicals shows volatile performance in terms of revenue and profit margins. The gross profit margin has decreased significantly from 19.58% in 2020 to 5.49% in 2024. The net profit margin improved to 2.72% in 2024 after negative results in 2022 and 2023. Revenue growth was strong at 49.18% from 2023 to 2024, indicating recovery. However, previous years showed inconsistent performance, with EBIT margins improving recently but still below average.

Balance Sheet

The balance sheet reveals a concerning debt-to-equity ratio, which increased from 0.87 in 2020 to 2.24 in 2024, indicating high leverage. The equity ratio has decreased from 42.77% in 2020 to 22.22% in 2024, showing reduced financial stability. Return on Equity has improved to 10.84% in 2024, indicating better profitability compared to recent years.

Cash Flow

Cash flow analysis highlights challenges, with operating cash flow dropping to zero in 2024 after negative values in prior years. Free cash flow was consistently negative, indicating potential liquidity issues. The company needs to improve cash flow generation to support operations and growth.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	19.59B	13.13B	8.82B	9.50B	8.32B
Gross Profit	1.11B	168.77M	-70.38M	634.52M	1.63B
EBITDA	1.35B	812.91M	349.18M	388.69M	1.64B
Net Income	532.55M	91.48M	-307.88M	380.61M	1.12B
Balance Sheet
Total Assets	22.11B	21.00B	18.26B	14.28B	11.02B
Cash, Cash Equivalents and Short-Term Investments	888.79M	625.40M	387.63M	807.28M	946.58M
Total Debt	11.00B	10.27B	10.52B	6.27B	4.21B
Total Liabilities	17.21B	16.64B	13.93B	9.54B	6.23B
Stockholders Equity	4.91B	4.38B	4.30B	4.67B	4.71B
Cash Flow
Free Cash Flow	-398.88M	-1.29B	-3.52B	-834.29M	-209.13M
Operating Cash Flow	1.06B	-122.01M	-910.52M	1.63B	1.74B
Investing Cash Flow	-1.39B	-790.28M	-1.97B	-3.29B	-1.07B
Financing Cash Flow	533.27M	1.06B	2.50B	1.48B	-485.13M

China Sanjiang Fine Chemicals Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.28
• 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:2198, the sentiment is Positive. The current price of 2.28 is above the 20-day moving average (MA) of 1.93, above the 50-day MA of 1.88, and above the 200-day MA of 1.79, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 61.69 is Neutral, neither overbought nor oversold. The STOCH value of 79.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2198.

China Sanjiang Fine Chemicals Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0746	78 Outperform	4.29B	7.54	8.12%	6.80%	-3.73%	6.09%
2198	66 Neutral	HK$2.49B	3.55	13.87%	―	9.20%	213.87%
1702	57 Neutral	763.76M	10.65	4.69%	2.78%	-8.51%	-68.34%
0609	54 Neutral	1.25B	19.35	0.00%	3.47%	-5.29%	-32.47%
9933	48 Neutral	1.92B	111.36	2.18%	―	11.08%	147.89%
0954	46 Neutral	174.80M	-2.15	-11.70%	―	-17.15%	30.94%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

China Sanjiang Fine Chemicals Co., Ltd. Corporate Events

China Sanjiang Fine Chemicals Reports Strong Profit Growth Amid Market Challenges

China Sanjiang Fine Chemicals Co., Ltd. reported a significant increase in profitability for the first half of 2025, with net profit nearly doubling compared to the same period in 2024. This improvement was driven by favorable market dynamics for key products, particularly Ethylene Glycol, and strategic operational adjustments. Despite a challenging economic environment, the company managed to enhance its gross profit margin and benefited from positive price movements in silver. The company opted not to pay an interim dividend to maintain financial flexibility amidst potential economic uncertainties.

The most recent analyst rating on (HK:2198) stock is a Hold with a HK$2.00 price target. To see the full list of analyst forecasts on China Sanjiang Fine Chemicals Co., Ltd. stock, see the HK:2198 Stock Forecast page.

Sanjiang Fine Chemicals Enhances Energy Efficiency with Haoxing Partnership

China Sanjiang Fine Chemicals Co., Ltd. has announced a clarification and supplemental update regarding its Energy Management Agreement with Haoxing Energy Conservation. This agreement involves the modification of drive motors and cooling equipment at Sanjiang’s EO/EG production facilities to enhance energy efficiency and output. The collaboration is expected to reduce electricity costs for Sanjiang Chemical, with payments to Haoxing based on energy savings achieved. This initiative underscores Sanjiang’s strategic focus on operational efficiency and cost reduction, potentially strengthening its market position and benefiting stakeholders through improved profitability.

The most recent analyst rating on (HK:2198) stock is a Hold with a HK$2.00 price target. To see the full list of analyst forecasts on China Sanjiang Fine Chemicals Co., Ltd. stock, see the HK:2198 Stock Forecast page.

China Sanjiang Fine Chemicals Enhances Energy Efficiency with Haoxing Partnership

China Sanjiang Fine Chemicals Co., Ltd. has announced a supplemental agreement with Haoxing Energy Conservation to enhance the energy efficiency of its 6th phase EO/EG production facilities. The agreement involves the installation of advanced technology to modify drive motors and cooling equipment, aiming to increase output while reducing electricity consumption. This collaboration is expected to lower operational costs and enhance the company’s competitive positioning in the chemical industry.

China Sanjiang Fine Chemicals Reports Significant Profit Growth in H1 2025

China Sanjiang Fine Chemicals Co., Ltd. has announced a significant increase in its net profit for the first half of 2025, expecting to report over RMB300 million, a 95% rise compared to the same period in 2024. This growth is attributed to improved selling prices, better profit margins, and strategic adjustments in procurement and production in response to U.S. tariff policies, particularly regarding Ethane exports to China.

China Sanjiang Fine Chemicals Enhances Energy Efficiency with New Agreement

China Sanjiang Fine Chemicals Co., Ltd. has entered into an Energy Management Agreement with Haoxing Energy Conservation to enhance the energy efficiency of its 6th phase EO/EG production facilities. The agreement involves the installation of Haoxing’s self-developed equipment to improve the output efficiency of drive motors and cooling equipment, enabling significant electricity cost savings for Sanjiang Chemical. This strategic move is expected to optimize operational costs and strengthen the company’s market position by leveraging advanced energy-saving technologies.

China Sanjiang Fine Chemicals Enhances Governance with New Nomination Committee

China Sanjiang Fine Chemicals Co., Ltd. has established a Nomination Committee as part of its Board of Directors. The committee is tasked with appointing members from the company’s directors, ensuring a majority of independent non-executive directors, and is led by the Board’s chairman or an independent non-executive director. This move is expected to enhance governance and strategic oversight within the company, potentially impacting its operational efficiency and stakeholder confidence.