In This Article:
The Hong Kong market has shown resilience in recent weeks, with the Hang Seng Index gaining 5.12%, buoyed by the U.S. Federal Reserve's decision to cut interest rates. Despite some disappointing economic data from China, investor sentiment remains cautiously optimistic. In this environment, identifying undervalued stocks can be a strategic move for investors seeking opportunities amidst broader market fluctuations.
Top 10 Undervalued Stocks Based On Cash Flows In Hong Kong
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Yadea Group Holdings (SEHK:1585) | HK$11.78 | HK$23.20 | 49.2% |
| WuXi XDC Cayman (SEHK:2268) | HK$20.20 | HK$39.44 | 48.8% |
| Tencent Holdings (SEHK:700) | HK$388.60 | HK$769.47 | 49.5% |
| Shanghai INT Medical Instruments (SEHK:1501) | HK$28.90 | HK$56.20 | 48.6% |
| BYD (SEHK:1211) | HK$245.20 | HK$462.67 | 47% |
| Jiangxi Rimag Group (SEHK:2522) | HK$26.05 | HK$49.49 | 47.4% |
| Akeso (SEHK:9926) | HK$65.50 | HK$126.85 | 48.4% |
| Innovent Biologics (SEHK:1801) | HK$42.60 | HK$80.17 | 46.9% |
| Digital China Holdings (SEHK:861) | HK$3.29 | HK$6.11 | 46.2% |
| Weimob (SEHK:2013) | HK$1.30 | HK$2.56 | 49.3% |
We'll examine a selection from our screener results.
Yadea Group Holdings
Overview: Yadea Group Holdings Ltd. is an investment holding company involved in the development, manufacture, and sale of electric two-wheeled vehicles and related accessories in China, with a market cap of HK$35.83 billion.
Operations: The company's revenue segments include CN¥31.76 billion from electric two-wheeled vehicles and related accessories, and CN¥5.23 billion from batteries and electric drive.
Estimated Discount To Fair Value: 49.2%
Yadea Group Holdings appears undervalued based on cash flows, trading at HK$11.78, which is 49.2% below its estimated fair value of HK$23.2. Despite a recent decline in sales and net income for the first half of 2024, Yadea's earnings are forecast to grow faster than the Hong Kong market at 17.1% per year. Recent expansions into Thailand and Indonesia demonstrate strategic growth efforts, potentially bolstering future cash flows and supporting its valuation thesis.
Shenzhou International Group Holdings
Overview: Shenzhou International Group Holdings Limited is an investment holding company involved in the manufacture, printing, and sale of knitwear products across Mainland China, the European Union, the United States, Japan, and other international markets with a market cap of HK$95.53 billion.