Zhejiang Huahai Pharmaceutical Co Ltd

Zhejiang Huahai Pharmaceutical Co Ltd maintains a capital structure characterized by significant leverage, with long-term debt of 7.48 billion CNY against total equity of 8.90 billion CNY, resulting in a debt-to-equity ratio of 0.84. The company holds a current ratio of 1.42, indicating adequate short-term liquidity to cover immediate obligations. However, the firm reports negative free cash flow of -296 million CNY, driven by substantial capital expenditures of 1.85 billion CNY that exceed operating cash flow of 2.17 billion CNY. This heavy investment phase contributes to a negative net cash position, as total debt exceeds available cash reserves.

Profitability metrics indicate modest returns relative to the capital base, with a return on equity of 5.51% and a return on assets of 2.42%. The company generates a gross profit of 5.81 billion CNY on revenues of 9.55 billion CNY, yielding a gross margin of approximately 60.8%. Operating income stands at 1.46 billion CNY, leading to a net income of 1.12 billion CNY. While the gross margins are robust, the net margin of approximately 11.7% suggests significant operating expenses or interest costs impacting the bottom line.

Revenue concentration data is not explicitly detailed in the provided segments or geography sections, limiting the ability to assess specific product or regional dependencies. The company operates within the broader pharmaceuticals industry, where revenue streams are typically diversified across various therapeutic areas, though specific segment breakdowns are absent from the current data snapshot.

Growth trajectory analysis is constrained by the absence of historical period data in the input. Without multi-year revenue or net income trends, it is not possible to quantify the company's historical growth rate or momentum. The current revenue base of 9.55 billion CNY provides a scale reference, but year-over-year changes cannot be calculated from the available single-period snapshot.

Risk assessment highlights medium liquidity risk and low dilution risk. A key flag notes that net cash is negative after subtracting total debt, which may constrain financial flexibility during periods of market stress or increased funding needs. The low dilution risk suggests that the share count of 1.497 billion shares is stable, with no immediate indications of significant equity issuance that would erode shareholder value.

Recent observations include analyst estimates with a mean price target of 17.50 CNY and a median target of 18.00 CNY, implying modest upside from the current market price of 16.84 CNY. The mean recommendation of 2.67 indicates a neutral to slightly positive sentiment among analysts, with two buy ratings and no strong buy or hold ratings recorded. These signals suggest cautious optimism regarding the company's near-term prospects.

Operating and net margins exceed pharmaceutical cohort medians, indicating superior profitability relative to peers.

Return on equity surpasses the cohort median, demonstrating efficient capital utilization compared to industry peers.

Analysts project 10.8% upside to the mean price target, suggesting potential valuation appreciation.

Cash conversion ranks in the top quartile of the cohort, highlighting strong operational efficiency.

Debt-to-equity ratio sits in the bottom quartile, indicating significantly higher leverage than most peers.

High credit risk flags suggest significant concerns regarding the company's ability to meet debt obligations.

Revenue ¥2.34B, −1,4% YoY; Operating income +17,9% YoY.

• ▍Revenue ¥2.34B, −1,4% YoY
• ▍Operating income +17,9% YoY
• ▍Net income +35,9% YoY
• ▍Net margin 17.3%

Revenue ¥2.18B, −5,3% YoY; Operating income −164,2% YoY.

• ▍Revenue ¥2.18B, −5,3% YoY
• ▍Operating income −164,2% YoY
• ▍Net income −229,9% YoY
• ▍Net margin -5.2%

Revenue ¥2.15B, −18,3% YoY; Operating income −71,8% YoY.

• ▍Revenue ¥2.15B, −18,3% YoY
• ▍Operating income −71,8% YoY
• ▍Net income −76,5% YoY
• ▍Net margin 5.2%

Revenue ¥2.30B; Operating income ¥153.8M.

• ▍Revenue ¥2.30B
• ▍Operating income ¥153.8M
• ▍Net margin 3.8%

Revenue ¥2.12B; Operating income ¥359.5M.

• ▍Revenue ¥2.12B
• ▍Operating income ¥359.5M
• ▍Net margin 13.3%

Revenue ¥2.63B; Operating income ¥582.9M.

• ▍Revenue ¥2.63B
• ▍Operating income ¥582.9M
• ▍Net margin 18.2%

Revenue ¥8.59B, −10,1% YoY; Operating income −69,7% YoY.

• ▍Revenue ¥8.59B, −10,1% YoY
• ▍Operating income −69,7% YoY
• ▍Net income −76,2% YoY
• ▍Free cash flow −326,3% YoY
• ▍Net margin 3.1%

Revenue ¥9.55B, +14,9% YoY; Operating income +30,0% YoY.

• ▍Revenue ¥9.55B, +14,9% YoY
• ▍Operating income +30,0% YoY
• ▍Net income +34,7% YoY
• ▍Free cash flow +44,9% YoY
• ▍Net margin 11.7%

Revenue ¥8.31B, +0,5% YoY; Operating income −27,3% YoY.

• ▍Revenue ¥8.31B, +0,5% YoY
• ▍Operating income −27,3% YoY
• ▍Net income −28,9% YoY
• ▍Free cash flow +30,6% YoY
• ▍Net margin 10.0%

Revenue ¥8.27B, +24,4% YoY; Operating income +80,0% YoY.

• ▍Revenue ¥8.27B, +24,4% YoY
• ▍Operating income +80,0% YoY
• ▍Net income +139,5% YoY
• ▍Free cash flow +56,3% YoY
• ▍Net margin 14.1%

Revenue ¥6.64B; Operating income ¥859.6M.

• ▍Revenue ¥6.64B
• ▍Operating income ¥859.6M
• ▍Net margin 7.3%