Keshun Waterproof Technologies Co Ltd

Keshun Waterproof Technologies maintains a capital structure characterized by significant leverage and negative net cash. Total liabilities stand at 8.43 billion CNY against total equity of 3.97 billion CNY, resulting in a debt-to-equity ratio of 1.1. The company holds 4.38 billion CNY in long-term debt, which exceeds its total equity, indicating a highly leveraged balance sheet. Liquidity is assessed as medium risk, supported by a current ratio of 1.4, which suggests adequate short-term asset coverage for current liabilities. However, the key flag of negative net cash after subtracting total debt highlights a reliance on external financing or operational cash generation to service obligations. The market capitalization is 7.26 billion CNY, with an enterprise value-to-revenue multiple of 1.73, reflecting the market's valuation of the company's asset base and future cash flow potential despite current profitability challenges.

Profitability metrics indicate severe operational distress in the latest period. The company reported a net loss of 535.34 million CNY on revenues of 6.04 billion CNY, resulting in a negative net margin. Operating income was negative at -584.52 million CNY, while gross profit was 1.44 billion CNY, implying high operating expenses or impairments eroding the gross margin. Return on equity is negligible at 0.59%, and return on assets is 0.19%, both significantly below typical industry medians for construction materials firms, which generally exhibit positive returns. The price-to-earnings ratio is distorted at 312.63 due to the minimal earnings base, and the EV/EBITDA multiple is elevated at 535.20, signaling that the company is not currently generating sufficient earnings to justify its enterprise value under normal valuation frameworks.

Revenue concentration and segment details are not explicitly provided in the available data, preventing a detailed analysis of geographic or product mix exposure. The company operates within the construction materials industry, which is typically sensitive to real estate and infrastructure spending cycles. Without specific segment data, the revenue base of 6.04 billion CNY is treated as a consolidated figure, implying that the company's performance is broadly tied to the overall health of the construction sector in its primary markets. The lack of segment disclosure limits the ability to assess diversification benefits or specific growth drivers within different product lines.

The growth trajectory is obscured by the absence of historical period data in the input. The current revenue of 6.04 billion CNY serves as the baseline, but without year-over-year or quarter-over-quarter comparisons, the direction of revenue growth cannot be determined. The negative operating income and net income suggest a contraction in profitability, but whether this is due to declining revenues, rising costs, or one-time charges is unclear from the snapshot alone. The capital expenditure of -172.50 million CNY indicates ongoing investment in assets, but the free cash flow is negative at -875.33 million CNY, driven by the operating cash flow of 319.63 million CNY being insufficient to cover capital needs and debt servicing.

Risk factors are elevated due to the company's liquidity and solvency profile. The medium liquidity risk is compounded by the negative net cash position, which limits financial flexibility. Dilution risk is assessed as low, with basic and diluted shares outstanding identical at 1.11 billion, suggesting no immediate options or convertible securities are impacting the share count. However, the high debt load and negative earnings create a vulnerability to interest rate hikes or credit tightening. The key flag of negative net cash after debt subtraction is a critical monitorable metric, as it indicates the company may need to raise additional capital or refinance existing debt, potentially under unfavorable terms.

Recent events and analyst sentiment provide a mixed outlook. The mean analyst price target is 7.65 CNY, which is higher than the current market price of 6.54 CNY, suggesting potential upside if the company stabilizes its operations. The mean recommendation is 1.67, indicating a strong buy consensus among the three covering analysts, with one strong buy and two buy ratings. This positive sentiment may reflect expectations of a turnaround in the construction materials sector or specific company initiatives not detailed in the financial snapshot. However, the lack of hold or sell ratings suggests a limited diversity of opinion, which could indicate a herd mentality or limited analyst coverage.

Analysts maintain a buy recommendation with a mean price target of 7.65, implying modest upside from the current market price.

The company demonstrates best-in-class cash conversion at 13.76, significantly outperforming the cohort median of 1.2.

Capex intensity is above median at -0.0256, suggesting lower capital expenditure requirements relative to revenue compared to peers.

The company faces high credit risk and medium liquidity risk, exacerbating concerns over its deteriorating financial position.

Operating and net margins sit in the bottom quartile of the cohort, reflecting poor profitability relative to peers.

Revenue ¥1.69B; Operating income -¥97.5M.

• ▍Revenue ¥1.69B
• ▍Operating income -¥97.5M
• ▍Net margin -5.4%

Revenue ¥1.67B; Operating income ¥32.4M.

• ▍Revenue ¥1.67B
• ▍Operating income ¥32.4M
• ▍Net margin 1.9%

Revenue ¥1.99B; Operating income ¥36.8M.

• ▍Revenue ¥1.99B
• ▍Operating income ¥36.8M
• ▍Net margin 2.1%

Revenue ¥6.04B, −11,5% YoY; Operating income −2 696,5% YoY.

• ▍Revenue ¥6.04B, −11,5% YoY
• ▍Operating income −2 696,5% YoY
• ▍Net income −1 610,0% YoY
• ▍Free cash flow −914,1% YoY
• ▍Net margin -8.9%

Revenue ¥6.83B, −14,0% YoY; Operating income +105,1% YoY.

• ▍Revenue ¥6.83B, −14,0% YoY
• ▍Operating income +105,1% YoY
• ▍Net income +110,5% YoY
• ▍Free cash flow +87,9% YoY
• ▍Net margin 0.5%

Revenue ¥7.94B, +3,7% YoY; Operating income −331,3% YoY.

• ▍Revenue ¥7.94B, +3,7% YoY
• ▍Operating income −331,3% YoY
• ▍Net income −289,5% YoY
• ▍Free cash flow −3 147,9% YoY
• ▍Net margin -4.2%

Revenue ¥7.66B, −1,4% YoY; Operating income −76,4% YoY.

• ▍Revenue ¥7.66B, −1,4% YoY
• ▍Operating income −76,4% YoY
• ▍Net income −73,5% YoY
• ▍Free cash flow −108,3% YoY
• ▍Net margin 2.3%

Revenue ¥7.77B; Operating income ¥810.7M.

• ▍Revenue ¥7.77B
• ▍Operating income ¥810.7M
• ▍Net margin 8.7%