Rego Interactive Co., Ltd. (2422) AI Stock Analysis

• Market Cap: HK$900.00M
• Dividend Yield: N/A
• Average Volume (3M): 554.40K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.04
• Revenue Growth: 10.61%
• EPS Growth: -1448.48%
• Country: HK
• Employees: 311
• Sector: Communication Services
• Sector Strength: 97
• Industry: Advertising Agencies
• EPS (TTM): -0.01
• Shares Outstanding: 1,500,000,000
• 10 Day Avg. Volume: 765,000
• 30 Day Avg. Volume: 554,400
• PEG Ratio: 0.10
• Price to Book (P/B): 3.57
• Price to Sales (P/S): 5.25
• P/FCF Ratio: -94.01
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: HK$0.50 ▼(-16.67% Downside)

The overall stock score is primarily influenced by the company's financial performance challenges and valuation concerns. While technical analysis shows strong momentum, the overbought indicators and lack of earnings call data or corporate events limit the potential upside.

Rego Interactive Co., Ltd. Business Overview & Revenue Model

Company Description

Rego Interactive Co., Ltd provides marketing services in the People's Republic of China. It operates in two segments, Marketing and Promotion Services, and Information Technology (IT) Solutions Services. The Marketing and Promotion Services segment offers promotion and advertising services, where the company assist enterprise advertisers in acquiring and/or reactivating users through various services, including traditional marketing and promotion services; advertisement placement services; and advertisement distribution services. This segment also provides virtual goods sourcing and delivery services, where it sources virtual goods, such as top-up coupons of telecommunication services, digital vouchers, and gift cards for enterprises and delivers the virtual goods to user acquisition, engagement, and/or retention purposes. The IT Solutions Services segment offers mobile game, and software development and maintenance services; and solutions on lottery-related software systems and equipment. The company also sells lottery tickets through its offline shops. Its customers primarily include enterprise advertisers and advertising agents using its traditional marketing and promotion services; enterprise advertisers and advertising agents engaging for advertisement placement services; media publishers as advertising agents using its advertisement distribution services; enterprises and virtual goods procurement agents procuring virtual goods; and mobile game operators, as well as welfare lottery centers and lottery sales points using its IT solutions services. The company was founded in 2009 and is headquartered in Hangzhou, China.

How the Company Makes Money

Rego Interactive Co., Ltd. generates revenue primarily through the sale and distribution of its mobile games and applications. The company employs a freemium model for many of its games, where the basic version is free to play, while in-game purchases and premium features provide additional revenue streams. Additionally, Rego Interactive earns income from digital marketing services by offering targeted advertising solutions and interactive marketing campaigns for corporate clients. Partnerships with other technology firms and content creators further augment their revenue by expanding their service offerings and market reach.

Rego Interactive Co., Ltd. Financial Statement Overview

Summary

Rego Interactive Co., Ltd. faces significant financial challenges, particularly in terms of profitability and cash flow generation. The income statement and cash flow metrics highlight operational inefficiencies and cash management issues, although the balance sheet remains relatively stable.

Income Statement

Rego Interactive Co., Ltd. has experienced a volatile revenue trajectory, with a recent decline in revenue and profitability. The gross profit margin has decreased significantly, and the company reported a negative net profit margin in the latest year, indicating challenges in maintaining profitability. The EBIT and EBITDA margins have also turned negative, reflecting operational inefficiencies.

Balance Sheet

The company's balance sheet shows a relatively stable equity position with a debt-to-equity ratio that remains manageable. However, the decline in stockholders' equity and total assets over the years raises concerns about asset management and financial stability. The equity ratio remains healthy, indicating a strong equity base relative to total assets.

Cash Flow

Cash flow analysis reveals inconsistent free cash flow generation, with recent periods showing negative free cash flow. The operating cash flow to net income ratio has improved but remains volatile. The company's ability to convert net income into cash flow is a concern, impacting its financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	264.21M	244.65M	191.06M	256.59M	219.55M	113.04M
Gross Profit	45.88M	65.81M	101.67M	133.46M	110.21M	75.87M
EBITDA	-51.60M	-27.39M	24.22M	84.77M	69.04M	50.20M
Net Income	-61.06M	-37.96M	12.56M	68.50M	49.98M	45.78M
Balance Sheet
Total Assets	599.59M	531.95M	637.38M	399.70M	235.06M	154.31M
Cash, Cash Equivalents and Short-Term Investments	103.67M	138.99M	186.48M	186.85M	61.48M	32.06M
Total Debt	114.32M	94.05M	156.35M	38.35M	21.10M	10.38M
Total Liabilities	263.16M	173.16M	244.73M	102.24M	129.16M	51.66M
Stockholders Equity	338.43M	359.62M	392.66M	297.46M	105.90M	102.65M
Cash Flow
Free Cash Flow	47.57M	-13.65M	-80.46M	-9.51M	24.28M	7.20M
Operating Cash Flow	74.17M	14.33M	-77.74M	-7.18M	26.59M	15.96M
Investing Cash Flow	17.63M	5.86M	-100.82M	-2.33M	-7.22M	-21.52M
Financing Cash Flow	-71.71M	-67.68M	178.19M	134.88M	10.05M	-4.72M

Rego Interactive Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2422, the sentiment is Positive. The current price of 0.6 is above the 20-day moving average (MA) of 0.58, above the 50-day MA of 0.49, and above the 200-day MA of 0.45, indicating a bullish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 60.64 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2422.

Rego Interactive Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9919	71 Outperform	HK$774.53M	8.48	26.71%	8.94%	-9.72%	-13.36%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
2422	54 Neutral	HK$900.00M	-13.48	-16.52%	―	10.61%	-1448.48%
1993	48 Neutral	HK$334.71M	-6.50	―	―	-38.24%	-31.99%
1753	45 Neutral	HK$279.97M	―	-3.55%	―	-5.89%	-330.91%
0205	44 Neutral	HK$347.83M	-25.40	-6.02%	―	-4.13%	76.38%
1917	43 Neutral	HK$153.97M	-9.71	-31.88%	―	-5.03%	-35.29%

Rego Interactive Co., Ltd. Corporate Events

Rego Interactive Reports Interim Financial Results Amid Shifting Advertising Landscape

Rego Interactive Co., Ltd. announced its unaudited interim financial results for the first half of 2025, revealing a 16.8% increase in revenue but a significant decline in gross profit and a net loss compared to the previous year. The company attributes these results to a downturn in consumer market sentiment in China, leading to reduced marketing budgets, and the rapid evolution of digital advertising driven by AI and automation. Despite these challenges, Rego Interactive aims to capitalize on its expertise and new product offerings to navigate the shifting advertising landscape.

The most recent analyst rating on (HK:2422) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on Rego Interactive Co., Ltd. stock, see the HK:2422 Stock Forecast page.

Rego Interactive Issues Profit Warning Amid Economic Challenges

Rego Interactive Co., Ltd. has issued a profit warning, anticipating a significant net loss of at least RMB17.3 million for the first half of 2025, a stark contrast to the net profit recorded in the same period of 2024. This downturn is attributed to reduced marketing budgets in China and a cautious approach in customer selection amid a challenging global economic climate. The company plans to focus on its core business areas, improve operational efficiency, and seek new opportunities in digitalization solutions to navigate the economic uncertainties.

The most recent analyst rating on (HK:2422) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on Rego Interactive Co., Ltd. stock, see the HK:2422 Stock Forecast page.

Rego Interactive Updates on 2023 Share Award Scheme

Rego Interactive Co., Ltd has issued a supplemental announcement regarding its 2024 Annual Report, specifically addressing the 2023 Share Award Scheme. The scheme, which allows employees, officers, and directors to participate, is funded by existing shares, with 14,864,000 shares available for grant. However, no awards under this scheme have been granted or agreed upon during the financial year ending December 31, 2024, or the six months ending June 30, 2025. This supplemental information does not alter other details in the 2024 Annual Report.