Hota Industrial Manufacturing Co., Ltd. (1536) AI Stock Analysis

Hota Industrial Manufacturing Co., Ltd.

(TWSE:1536)

Select Model

Rating:33Underperform

Price Target:TWD 33.00▼(-13.61% Downside)

Action:initiatedcoverage

Date:11/09/26

Hota Industrial Manufacturing scores poorly, driven primarily by weak financial performance: falling revenue, a near-total collapse in gross margin to under 2%, a second consecutive operating loss, and rising leverage (debt 1.65x equity) that is eroding the equity cushion. Technicals reinforce the caution, with the stock trading below all major moving averages and a negative MACD, although extremely low RSI and Stochastic readings suggest the selling may be stretched in the near term. Valuation provides no cushion, as the negative P/E reflects losses and there is no dividend to compensate investors. The one encouraging element is the cash flow inflection — operating cash flow above NT$1 billion and the first positive free cash flow in years — which buys management time to service debt, but a durable recovery requires margin restoration and revenue stabilization that has not yet materialized.

Positive Factors

Revenue ReboundThe strong annual revenue rebound indicates that Hota retained or regained demand for its precision components and machining-related products. If this top-line recovery persists, it can provide a broader base over which to restore margins, support production utilization, and rebuild earnings power.

Negative Factors

Severe Profitability DeteriorationThe sharp margin collapse and sizeable net loss show that revenue growth is not currently translating into economic profit. Unless pricing and cost structure improve, weak earnings quality could persist, constrain reinvestment, erode equity returns, and make the recent revenue recovery less valuable.

Hota Industrial Manufacturing Co., Ltd. (1536) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 10.75B
Dividend Yield: ―
Average Volume (3M): 980.44K
Price to Earnings (P/E): -19.9
Beta (1Y): 0.99
Revenue Growth: -4.17%
EPS Growth: -15.31%
Country: TW
Employees: 1,235
Sector: General
Sector Strength: 55
Industry: Auto - Parts

Hota Industrial Manufacturing Co., Ltd. Business Overview & Revenue Model

Company Description

Hota Industrial Mfg. Co., Ltd., based in Taichung, Taiwan, is a global enterprise specializing in the production and distribution of automotive transmission components. Its products, marketed across Taiwan, the United States, China, and other interna...

Hota Industrial Manufacturing Co., Ltd. Financial Statement Overview

Summary

Fundamentals are deteriorating sharply. Revenue has fallen roughly 35% since 2022 to NT$4.76 billion, gross margin has collapsed from 23.1% to just 1.9%, and the company posted a second straight operating loss (-10.5% margin) and a NT$756 million net loss. The balance sheet is stretched, with debt of NT$12.75 billion exceeding equity of NT$7.75 billion (D/E of 1.65, up from 1.17 in 2021) and ROE at -9.8% as losses erode the capital base. The one bright spot is cash: operating cash flow rebounded to NT$1.01 billion and free cash flow turned positive at NT$363 million for the first time in years on reduced capex, but this is driven by working capital release and spending discipline rather than earnings recovery.

Income Statement

16Very Negative

Balance Sheet

30Negative

Cash Flow

48Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	4.75B	4.76B	5.77B	6.60B	7.34B	6.69B
Gross Profit	138.08M	92.14M	681.74M	1.11B	1.70B	1.68B
EBITDA	328.76M	230.75M	1.11B	1.27B	1.54B	1.08B
Net Income	-533.70M	-756.49M	195.06M	327.21M	623.96M	341.82M
Balance Sheet
Total Assets	21.13B	21.57B	22.44B	22.33B	22.93B	21.10B
Cash, Cash Equivalents and Short-Term Investments	873.49M	876.29M	1.16B	936.19M	1.37B	1.11B
Total Debt	9.82B	12.75B	12.64B	12.09B	11.91B	10.10B
Total Liabilities	13.56B	13.66B	13.49B	13.49B	13.95B	12.36B
Stockholders Equity	7.42B	7.75B	8.83B	8.72B	8.85B	8.62B
Cash Flow
Free Cash Flow	332.03M	362.93M	-343.72M	-156.66M	-1.55B	-1.07B
Operating Cash Flow	813.49M	1.01B	184.80M	852.25M	-150.91M	515.94M
Investing Cash Flow	-451.32M	-910.87M	-556.25M	-947.76M	-1.56B	-1.34B
Financing Cash Flow	-286.69M	-183.54M	283.50M	-194.83M	1.77B	972.75M

Hota Industrial Manufacturing Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:1536 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:6279	64Neutral	TWD 11.90B	8.76	―	5.62%	12.67%	15.02%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:3162	50Neutral	TWD 11.07B	105.25	―	1.12%	36.58%	-66.59%
TW:1532	48Neutral	TWD 9.11B	22.83	―	3.73%	0.87%	215.40%
TW:1569	48Neutral	TWD 13.70B	-28.45	―	―	-6.07%	33.08%
TW:1563	47Neutral	TWD 11.11B	36.03	―	7.64%	3.41%	-5.16%
TW:1536	33Underperform	TWD 10.59B	-19.89	―	―	-4.17%	-15.31%

* General Sector Average

Performance Comparison

TW:1536 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:1536	Hota Industrial Manufacturing Co., Ltd.	38.20	-21.20	-35.69%
TW:1532	China Metal Products Co., Ltd.	21.45	-4.06	-15.92%
TW:1563	SuperAlloy Industrial Co., Ltd.	67.60	12.72	23.18%
TW:1569	Bin Chuan Enterprise Co., Ltd.	104.50	44.60	74.46%
TW:3162	United Alloy-Tech Company Ltd	77.40	21.70	38.95%
TW:6279	Hu Lane Associate, Inc.	97.90	-26.47	-21.28%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Nov 09, 2026

Hota Industrial Manufacturing Co., Ltd. AI Stock Analysis