| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 19.79 | 119 |
| Intrinsic value (DCF) | 4.90 | -46 |
| Graham-Dodd Method | 0.29 | -97 |
| Graham Formula | 5.49 | -39 |
Hangzhou Cable Co., Ltd. is a prominent Chinese manufacturer specializing in the research, development, and sale of a comprehensive portfolio of wires and cables. Founded in 1958 and headquartered in Hangzhou, the company serves both domestic and international markets with products including high-voltage cables, power cables, overhead conductors, control cables, and specialized wires like mineral insulation and mining cables. Operating within the Industrials sector's Electrical Equipment & Parts industry, Hangzhou Cable is a key supplier for critical infrastructure projects, including power transmission and distribution networks. The company leverages its long-standing history and technical expertise to cater to the demands of China's ongoing energy and infrastructure development. Its product range, which also features aluminum alloy wires and heat-resistant cables, positions it as a versatile player in a market driven by urbanization, grid upgrades, and renewable energy expansion. This SEO-optimized overview highlights Hangzhou Cable's role as an established industrial cable manufacturer with a significant footprint in China's essential infrastructure supply chain.
Hangzhou Cable presents a mixed investment profile characterized by its stable, long-established market position against a backdrop of significant financial leverage. The company's appeal lies in its essential role in China's infrastructure and energy sectors, with a beta of 0.463 suggesting lower volatility than the broader market. However, major concerns are evident in its balance sheet, with total debt of CNY 4.45 billion substantially outweighing cash and equivalents of CNY 945 million, indicating a high debt burden. While the company was profitable with a net income of CNY 137.9 million, its operating cash flow of CNY 91.2 million was insufficient to cover capital expenditures of CNY -280.2 million, pointing to potential cash flow constraints. The modest dividend yield, based on a CNY 0.06 per share payout, offers limited income attraction. The investment case hinges on the company's ability to manage its debt load while capitalizing on sustained demand from state-driven infrastructure projects.
Hangzhou Cable operates in the highly competitive and fragmented Chinese wire and cable market. Its competitive positioning is defined by its long history, established customer relationships, and a broad product portfolio that serves various applications from power transmission to specialized industrial uses. A key advantage is its integration into China's domestic supply chain for critical infrastructure, potentially providing a steady stream of business from state-owned utility and construction companies. However, the industry is characterized by intense price competition and relatively low product differentiation, which can compress profit margins. The company's significant debt level (CNY 4.45 billion) is a critical weakness compared to more financially conservative competitors, potentially limiting its agility and investment capacity for technological upgrades or expansion. Its scale, while substantial, is dwarfed by national champions, confining it to a strong regional or niche player status rather than a dominant national leader. The competitive landscape demands continuous operational efficiency and a focus on higher-margin, specialized products to maintain relevance against both larger integrated players and smaller, low-cost manufacturers. Its future advantage will depend on leveraging its expertise in specific cable types, such as overhead and high-voltage temperature-measuring cables, to secure contracts in targeted infrastructure projects.