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Stock Analysis & ValuationJiangsu Olive Sensors High-Tech Co., Ltd. (300507.SZ)

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Previous Close
$9.57
Sector Valuation Confidence Level
Moderate
Valuation methodValue, $Upside, %
Artificial intelligence (AI)45.41375
Intrinsic value (DCF)85.10789
Graham-Dodd Method2.42-75
Graham Formula9.873

Strategic Investment Analysis

Company Overview

Jiangsu Olive Sensors High-Tech Co., Ltd. is a specialized Chinese automotive components manufacturer with a focus on sensor technology and engineering plastic parts. Founded in 1993 and headquartered in Yangzhou, the company has established itself as a key supplier in China's rapidly growing automotive industry. Olive Sensors develops, produces, and sells a diverse range of automotive sensors and accessories, fuel system components, and interior plastic parts, serving both domestic and international automotive manufacturers. As China continues to lead global automotive production and transitions toward electric and smart vehicles, the company's sensor expertise positions it at the forefront of automotive technology evolution. The company's product portfolio addresses critical vehicle systems including emissions control, fuel efficiency, and vehicle intelligence, making it an integral part of the automotive supply chain. With over 30 years of industry experience, Olive Sensors has built strong relationships with automotive OEMs while maintaining technological innovation in sensor applications for traditional and new energy vehicles alike.

Investment Summary

Jiangsu Olive Sensors presents a specialized play on China's automotive components sector with moderate financial performance. The company generated CNY 1.67 billion in revenue with net income of CNY 137.9 million, translating to a diluted EPS of CNY 0.17. While the company maintains a conservative financial profile with low beta (0.129) and manageable debt levels (CNY 360.6 million debt versus CNY 274.4 million cash), its profitability metrics appear modest relative to its market capitalization of CNY 6.93 billion. The positive operating cash flow of CNY 187.9 million is partially offset by significant capital expenditures (CNY -192.4 million), indicating ongoing investment in capacity. The dividend yield, based on a CNY 0.06 per share payout, provides some income component. Investment attractiveness hinges on the company's ability to capitalize on China's automotive technology transition, particularly in sensor applications for electric and smart vehicles, though competitive pressures in the auto parts sector remain a key consideration.

Competitive Analysis

Jiangsu Olive Sensors operates in the highly competitive Chinese automotive components sector, where its competitive positioning is defined by its specialization in sensor technology within a broader auto parts landscape. The company's primary competitive advantage lies in its focused expertise in automotive sensors, which are increasingly critical for vehicle efficiency, emissions control, and intelligent systems. With three decades of industry presence, Olive Sensors has likely developed entrenched relationships with Chinese automotive manufacturers, providing some insulation against pure price competition. However, the company faces significant challenges from larger, more diversified auto parts suppliers that can offer comprehensive component systems and benefit from greater economies of scale. The transition toward electric vehicles represents both an opportunity and threat—while creating demand for new sensor applications, it also disrupts traditional supply chains and may favor suppliers with stronger EV-specific capabilities. Olive Sensors' moderate financial scale (CNY 1.67 billion revenue) suggests it occupies a niche position rather than market leadership, competing through specialized technical capabilities rather than broad market dominance. The company's future competitiveness will depend on its ability to innovate in sensor technology for evolving vehicle architectures while maintaining cost competitiveness against both domestic and international component suppliers.

Major Competitors

  • Huayu Automotive Systems Co., Ltd. (600741.SS): Huayu Automotive is one of China's largest auto parts manufacturers with extensive product portfolio and scale advantages. Its strengths include comprehensive component systems, strong relationships with major OEMs like SAIC Motor, and significant R&D capabilities. However, as a large conglomerate, it may lack the specialized focus that niche sensor manufacturers like Olive Sensors can offer. Huayu's broad market presence creates competitive pressure on pricing and customer access for smaller specialized suppliers.
  • Anhui Zhongding Sealing Parts Co., Ltd. (000887.SZ): Zhongding specializes in automotive sealing systems but has diversified into various automotive components. The company benefits from strong technical expertise in materials science and global customer base including international OEMs. Its weakness relative to Olive Sensors is less focused expertise in sensor technology specifically. Zhongding's larger scale (approximately 10x Olive Sensors' revenue) provides competitive advantages in purchasing power and customer relationships.
  • Zhejiang Silver Elephant Auto Parts Co., Ltd. (002126.SZ): Silver Elephant focuses on automotive engine components and sensors, making it a more direct competitor to Olive Sensors. The company has strong capabilities in fuel injection systems and related sensors. Its competitive weakness includes smaller scale compared to largest Chinese suppliers and potentially limited diversification. Silver Elephant's similar focus on precision components creates direct competition in sensor applications, though market segmentation may allow coexistence.
  • Jiangsu Pacific Precision Forging Co., Ltd. (300258.SZ): Pacific Precision specializes in automotive precision forgings and gear components, with growing involvement in transmission and drivetrain systems. The company's strength lies in precision manufacturing technology and relationships with global Tier 1 suppliers. Its competitive positioning differs from Olive Sensors as it focuses more on mechanical components rather than electronic sensors, though both serve the broader automotive components market with technical specialization.
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