| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 60.44 | 154 |
| Intrinsic value (DCF) | 7.84 | -67 |
| Graham-Dodd Method | 5.57 | -77 |
| Graham Formula | 0.56 | -98 |
Fujian Longxi Bearing (Group) Co., Ltd is a leading Chinese manufacturer specializing in precision bearing solutions and mechanical components for demanding industrial applications. Founded in 1958 and headquartered in Zhangzhou, China, the company produces an extensive portfolio including spherical plain bearings, tapered roller bearings, deep groove ball bearings, and specialized rolling components. Longxi's products serve critical functions across multiple sectors including construction machinery (loaders, motor graders, diggers), heavy trucks, aerospace, aviation, hydropower projects, and port machinery. The company's expertise extends to manufacturing loader and fine machine gears, linear guide systems, ball screws, and rod ends, positioning it as a comprehensive solutions provider in the industrial machinery supply chain. With both domestic and international market presence, Fujian Longxi leverages China's manufacturing capabilities while serving global industrial equipment manufacturers requiring high-precision, durable bearing components for heavy-duty applications.
Fujian Longxi presents a mixed investment case with moderate appeal for value-oriented investors seeking exposure to China's industrial machinery sector. The company demonstrates reasonable financial stability with a market capitalization of approximately CNY 11.7 billion and a conservative beta of 0.648, suggesting lower volatility than the broader market. However, profitability metrics raise concerns with net income of CNY 125 million on revenue of CNY 1.78 billion, indicating thin margins of approximately 7%. The company maintains adequate liquidity with CNY 424 million in cash against CNY 256 million in debt, and positive operating cash flow of CNY 345 million supports ongoing operations. The dividend yield appears modest at CNY 0.10 per share. Primary investment risks include exposure to China's cyclical construction and machinery sectors, intense competition in bearing manufacturing, and pressure on profit margins. The company's established history and diverse industrial application base provide some defensive characteristics, but investors should monitor margin trends and end-market demand closely.
Fujian Longxi operates in the highly competitive global bearing industry, where it occupies a middle-tier position specializing in spherical plain bearings and components for heavy machinery applications. The company's competitive advantage stems from its long-established presence in China's industrial sector, diversified product portfolio across multiple bearing types, and specialization in components for construction and engineering machinery. Longxi's strength lies in serving domestic Chinese equipment manufacturers while maintaining some international presence, benefiting from China's manufacturing ecosystem and cost structure. However, the company faces significant competition from both larger global bearing manufacturers and smaller specialized Chinese producers. Its product range, while diverse, may lack the technological sophistication of premium international brands in high-precision applications. The company's positioning as a supplier to construction machinery manufacturers provides some insulation from consumer market fluctuations but creates dependency on infrastructure investment cycles. Longxi's competitive challenges include maintaining margin stability amid raw material cost fluctuations, competing with larger-scale global manufacturers, and advancing technological capabilities to serve increasingly sophisticated industrial applications. The company's regional focus and established customer relationships in China's industrial sector provide some defensive moat, but scaling internationally against established competitors remains challenging without significant technological differentiation or cost advantages.