| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 29.39 | 257 |
| Intrinsic value (DCF) | 2.93 | -64 |
| Graham-Dodd Method | 0.75 | -91 |
| Graham Formula | n/a |
Hunan Tyen Machinery Co., Ltd is a specialized Chinese manufacturer of critical engine components with a legacy dating back to 1950. Headquartered in Hengyang, China, the company focuses on the research, development, production, and sales of precision engine parts including exhaust turbochargers, intake and exhaust valves, cooling fans, and diesel/gasoline engine superchargers. Operating in the industrial machinery sector, Hunan Tyen serves diverse end markets including construction machinery, vehicle machinery, agricultural equipment, marine applications, and high-speed rail systems. The company's comprehensive product portfolio and after-sales services position it as a key supplier to China's massive industrial and transportation sectors. With China's ongoing infrastructure development and manufacturing expansion, Hunan Tyen plays a vital role in the engine components supply chain, leveraging its technical expertise and long-standing industry presence to maintain relevance in the competitive industrial machinery landscape.
Hunan Tyen Machinery presents a high-risk investment profile with concerning financial metrics. The company's beta of 1.505 indicates significant volatility relative to the market. Despite CNY 432.5 million in revenue, net income of only CNY 4.1 million reflects extremely thin margins of approximately 1%. The negative operating cash flow of CNY -14.7 million and substantial capital expenditures of CNY -51.1 million raise liquidity concerns, though the company maintains a strong cash position of CNY 254 million with minimal debt. The absence of dividends and extremely low diluted EPS of 0.0039 suggest limited shareholder returns. Investors should carefully evaluate the company's ability to improve operational efficiency and cash generation in China's competitive industrial machinery sector.
Hunan Tyen Machinery operates in a highly competitive Chinese industrial components market where scale, technological capability, and customer relationships determine success. The company's competitive positioning appears challenged given its thin profit margins and negative cash flow from operations. While the company benefits from its long-established presence since 1950 and diverse product portfolio serving multiple industrial segments, its financial performance suggests difficulty in maintaining pricing power or operational efficiency. The company's focus on engine components for construction, agricultural, and transportation machinery aligns with China's infrastructure development priorities, but it likely faces intense competition from both domestic manufacturers and international suppliers. The negative operating cash flow despite revenue generation indicates potential working capital management issues or competitive pressures requiring significant investment. The company's minimal debt provides some financial flexibility, but the substantial capital expenditures relative to size suggest ongoing investment requirements to maintain technological competitiveness. In China's fragmented industrial components market, Hunan Tyen must demonstrate improved operational execution to establish sustainable competitive advantages beyond its historical market presence.