| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 27.63 | 161 |
| Intrinsic value (DCF) | 6.13 | -42 |
| Graham-Dodd Method | 7.27 | -31 |
| Graham Formula | n/a |
Anhui Quanchai Engine Co., Ltd. is a prominent Chinese engine manufacturer specializing in the research, development, and production of diesel and petrol engines for diverse industrial applications. Founded in 1998 and headquartered in Chuzhou, China, the company serves global markets including Southeast Asia and Europe with engines for vehicles, agricultural machinery, forklifts, construction equipment, generator sets, and water pumps. Operating in the Auto Parts sector within the Consumer Cyclical industry, Quanchai leverages China's manufacturing ecosystem to deliver cost-effective power solutions across multiple segments. The company's diversified product portfolio positions it as a key player in China's industrial engine market, catering to both domestic and international demand for reliable power systems in various machinery applications. With its established presence and technical expertise, Anhui Quanchai represents a significant component of China's industrial manufacturing landscape.
Anhui Quanchai presents a mixed investment profile with several concerning financial metrics. The company's net income of CNY 83.35 million on revenue of CNY 3.97 billion indicates thin profit margins of approximately 2.1%, suggesting intense competition and pricing pressure in the engine manufacturing sector. While the company maintains a reasonable debt level with total debt of only CNY 64.33 million against cash reserves of CNY 724.17 million, the low beta of 0.865 indicates relative stability but limited growth correlation with broader market movements. The modest dividend yield and diluted EPS of CNY 0.19 reflect constrained profitability. The primary investment risks include margin compression, exposure to cyclical industrial demand, and competitive pressures from larger global engine manufacturers. The company's niche positioning in specific engine applications may provide some defensive characteristics but limits significant upside potential.
Anhui Quanchai operates in a highly competitive engine manufacturing market dominated by global giants and specialized regional players. The company's competitive positioning is primarily regional, focusing on cost-effective solutions for specific applications like agricultural equipment, forklifts, and construction machinery. Its advantage lies in localized manufacturing, understanding of Chinese market requirements, and established distribution networks within China and select international markets. However, Quanchai faces significant challenges from larger competitors with greater R&D capabilities, broader product portfolios, and stronger global presence. The company's relatively small market capitalization of CNY 4.15 billion limits its ability to compete on scale with industry leaders. Its technological capabilities, while sufficient for current market segments, may struggle to keep pace with the innovation and emission standards being driven by global manufacturers. The competitive landscape requires Quanchai to maintain cost leadership while potentially facing margin pressure from both larger competitors and smaller, more agile regional manufacturers. The company's diversification across multiple engine applications provides some stability but may also dilute focus compared to more specialized competitors.