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As global markets experience a mixed performance, the Hong Kong market has shown resilience with the Hang Seng Index gaining 2.14% recently. Amidst this environment, identifying undervalued stocks can be an effective strategy for investors looking to capitalize on potential growth opportunities.
Top 10 Undervalued Stocks Based On Cash Flows In Hong Kong
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Bosideng International Holdings (SEHK:3998) | HK$3.85 | HK$6.76 | 43.1% |
| Zhaojin Mining Industry (SEHK:1818) | HK$12.44 | HK$21.36 | 41.8% |
| WuXi XDC Cayman (SEHK:2268) | HK$19.64 | HK$39.11 | 49.8% |
| Pacific Textiles Holdings (SEHK:1382) | HK$1.52 | HK$2.85 | 46.7% |
| China Renaissance Holdings (SEHK:1911) | HK$7.27 | HK$12.30 | 40.9% |
| United Company RUSAL International (SEHK:486) | HK$2.35 | HK$4.25 | 44.7% |
| Vobile Group (SEHK:3738) | HK$1.54 | HK$2.63 | 41.5% |
| AK Medical Holdings (SEHK:1789) | HK$4.16 | HK$8.30 | 49.9% |
| DPC Dash (SEHK:1405) | HK$69.95 | HK$134.44 | 48% |
| Jinke Smart Services Group (SEHK:9666) | HK$8.29 | HK$13.99 | 40.7% |
Here's a peek at a few of the choices from the screener.
Beijing Chunlizhengda Medical Instruments
Overview: Beijing Chunlizhengda Medical Instruments Co., Ltd. is an orthopedic medical device company involved in the research, development, production, and trading of surgical implants and instruments in China, with a market cap of HK$4.10 billion.
Operations: Revenue from the manufacture and trading of surgical implants, instruments, and related products amounted to CN¥1.05 billion.
Estimated Discount To Fair Value: 18.3%
Beijing Chunlizhengda Medical Instruments is trading at HK$6.79, below its estimated fair value of HK$8.31, indicating it may be undervalued based on cash flows. Despite a recent decline in earnings and sales for the first half of 2024, the company’s revenue and earnings are forecast to grow significantly faster than the Hong Kong market over the next three years. The stock also offers good relative value compared to peers and industry benchmarks.
Binjiang Service Group
Overview: Binjiang Service Group Co. Ltd. provides property management and related services in the People’s Republic of China and has a market cap of HK$4.72 billion.
Operations: The company's revenue segments (in millions of CN¥) are property management services, valued at 1.25 billion CN¥, and related services, which amount to 750 million CN¥.