| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 68.34 | 397 |
| Intrinsic value (DCF) | 15.09 | 10 |
| Graham-Dodd Method | 6.55 | -52 |
| Graham Formula | n/a |
Hangzhou Star Shuaier Electric Appliance Co., Ltd. is a specialized Chinese manufacturer of critical compressor components, serving the global refrigeration and air conditioning industries. Founded in 1997 and headquartered in Hangzhou, China, the company has established itself as a key player in the electrical equipment sector with its core focus on designing, researching, developing, producing, and marketing overload protectors and starters for compressors. These essential components are vital for protecting compressor motors from damage due to electrical overloads, ensuring the reliability and longevity of refrigeration systems used in residential, commercial, and industrial applications. Operating within the industrials sector, Star Shuaier leverages its technical expertise to serve both domestic Chinese markets and international clients, positioning itself within the global supply chain for HVAC-R (Heating, Ventilation, Air Conditioning, and Refrigeration) equipment. The company's nearly three decades of operation demonstrate its resilience and specialized knowledge in a niche but essential segment of the electrical components industry, contributing to energy efficiency and system reliability in cooling technologies worldwide.
Hangzhou Star Shuaier presents a specialized investment opportunity with moderate financial performance and specific sector risks. The company generated CNY 2.08 billion in revenue with net income of CNY 143.7 million, resulting in a diluted EPS of CNY 0.47 and a dividend payout of CNY 0.10 per share. While the company maintains a solid cash position of CNY 589.1 million, investors should note the relatively high total debt of CNY 681.1 million and negative free cash flow position when considering capital expenditures. The beta of 0.873 suggests lower volatility than the broader market, which may appeal to conservative investors in the industrials sector. However, the company's niche focus on compressor components makes it vulnerable to cyclical trends in the HVAC-R and appliance industries, and its international operations expose it to global trade dynamics. The investment case hinges on the company's ability to maintain its specialized market position while managing its debt load and generating sustainable cash flows.
Hangzhou Star Shuaier operates in a highly specialized niche within the electrical components industry, focusing specifically on overload protectors and starters for compressors. This narrow focus provides both advantages and challenges in terms of competitive positioning. The company's nearly 30 years of experience suggests deep technical expertise in compressor protection technology, which likely creates barriers to entry for new competitors. However, the specialized nature of its products also limits diversification opportunities and makes the company highly dependent on the health of the compressor and refrigeration markets. Star Shuaier's competitive advantage appears to stem from its manufacturing capabilities and cost structure as a Chinese producer, allowing it to compete effectively on price in both domestic and international markets. The company's position in the global supply chain for HVAC-R components suggests established relationships with compressor manufacturers, though it likely faces pressure from both larger diversified component suppliers and lower-cost producers. Its moderate market capitalization of approximately CNY 4.57 billion indicates it is a mid-sized player rather than a market leader, which may limit its bargaining power with larger customers. The competitive landscape is characterized by technical specifications and reliability requirements that favor established players with proven track records, which works to Star Shuaier's benefit, but the company must continuously innovate to maintain its position against both domestic Chinese competitors and international component manufacturers.