Discovering 3 Undiscovered Gems in Hong Kong

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In recent weeks, the Hong Kong market has experienced mixed performance, with the Hang Seng Index declining slightly amid weak manufacturing data and broader global economic concerns. Despite these challenges, opportunities still exist for discerning investors willing to look beyond the headlines. In this context, identifying stocks with strong fundamentals and growth potential can be particularly rewarding. Here are three undiscovered gems in Hong Kong that merit closer attention.

Top 10 Undiscovered Gems With Strong Fundamentals In Hong Kong

Name

Debt To Equity

Revenue Growth

Earnings Growth

Health Rating

E-Commodities Holdings

23.22%

6.87%

31.81%

★★★★★★

S.A.S. Dragon Holdings

37.35%

4.13%

12.06%

★★★★★★

COSCO SHIPPING International (Hong Kong)

NA

-12.97%

12.59%

★★★★★★

PW Medtech Group

NA

17.93%

-2.70%

★★★★★★

Tianyun International Holdings

10.09%

-5.59%

-9.92%

★★★★★★

JiaXing Gas Group

17.72%

26.04%

22.07%

★★★★★☆

Xin Point Holdings

2.03%

9.80%

15.04%

★★★★★☆

Hung Hing Printing Group

3.97%

-2.51%

33.57%

★★★★★☆

Changjiu Holdings

14.09%

12.87%

-4.74%

★★★★★☆

Time Interconnect Technology

212.50%

27.21%

15.01%

★★★★☆☆

Click here to see the full list of 174 stocks from our SEHK Undiscovered Gems With Strong Fundamentals screener.

Below we spotlight a couple of our favorites from our exclusive screener.

Kinetic Development Group

Simply Wall St Value Rating: ★★★★★☆

Overview: Kinetic Development Group Limited (SEHK:1277) is an investment holding company involved in the extraction and sale of coal products in the People’s Republic of China, with a market cap of HK$9.02 billion.

Operations: Kinetic Development Group generates revenue primarily from the extraction and sale of coal products in China. The company reported a gross profit margin of 35.42% for the latest fiscal year, with total revenue amounting to CN¥4.75 billion.

Kinetic Development Group's debt to equity ratio improved from 26.6% to 17.6% over five years, reflecting better financial health. Despite negative earnings growth of -22%, the company trades at 29.3% below its estimated fair value, suggesting potential undervaluation. Interest payments are well covered by EBIT (55.7x). Recent amendments to their memorandum and articles of association were approved on May 7, 2024, alongside a final dividend declaration of HKD0.05 per share for FY2023.

SEHK:1277 Earnings and Revenue Growth as at Aug 2024
SEHK:1277 Earnings and Revenue Growth as at Aug 2024

Central China Securities

Simply Wall St Value Rating: ★★★★☆☆

Overview: Central China Securities Co., Ltd. is a securities company involved in brokerage, credit, futures, proprietary trading, investment banking and management with a market cap of HK$14.66 billion.