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Review of China Suntien (0956.HK)
12 Dec 2022 (251 views)  

I hold 90,000 shares of China Suntien at an average cost of $6.66 HKD. The current price is $3.20 giving me a loss of 52%. My current loss is $316,000 HKD, or $55,000 SGD.

The current price in HKSE is a discount of 73% of the price in Shanghai.

China Suntien now has a price earning ratio of 5.75X and a dividend yield of 6.1%. 

However, it has a high debt/equity ratio of 162%, This is extremely high. This may be the main reason for the poor performance of the share price over the past year.

It is likely that the company had to rely on debt to build its solar energy infrastructure, and to provide energy to the utility company. With the high price of energy, it should result in a high profit for the company, provided that it did not lock up the price of energy in long term contracts.

The interest rate in China is now 3.65%. It is slightly lower than the average rate for the past year.  While other countries, e.g. America, raised their interest rate over the past year, China was able to maintain the interest rate at the prevailing level. 

Here is a recent report about China Suntien. I am not able to judge if it is positive or negative for the company, and if the energy that is produced for its customers enjoy a long term fixed price contact.

Here is a detailed report on the financial position of China Suntien for the first half of 2022. The profit dropped slightly during this period, compared to the corresponding period of the previous financial year. 

I will monitor this share closely, now that I know more about its financial and business structure.

Note - I am sharing my view. I am not giving any investment advice. 

Tan Kin Lian


 


Review of China Suntien (0956.HK)
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I hold 90,000 shares of China Suntien at an average cost of $6.66 HKD. The current price is $3.20 giving me a loss of 52%. My current loss is $316,000 HKD, or $55,000 SGD.

The current price in HKSE is a discount of 73% of the price in Shanghai.

China Suntien now has a price earning ratio of 5.75X and a dividend yield of 6.1%. 

However, it has a high debt/equity ratio of 162%, This is extremely high. This may be the main reason for the poor performance of the share price over the past year.

It is likely that the company had to rely on debt to build its solar energy infrastructure, and to provide energy to the utility company. With the high price of energy, it should result in a high profit for the company, provided that it did not lock up the price of energy in long term contracts.

The interest rate in China is now 3.65%. It is slightly lower than the average rate for the past year.  While other countries, e.g. America, raised their interest rate over the past year, China was able to maintain the interest rate at the prevailing level. 

Here is a recent report about China Suntien. I am not able to judge if it is positive or negative for the company, and if the energy that is produced for its customers enjoy a long term fixed price contact.

Here is a detailed report on the financial position of China Suntien for the first half of 2022. The profit dropped slightly during this period, compared to the corresponding period of the previous financial year. 

I will monitor this share closely, now that I know more about its financial and business structure.

Note - I am sharing my view. I am not giving any investment advice. 

Tan Kin Lian