| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 20.38 | 174 |
| Intrinsic value (DCF) | 2.70 | -64 |
| Graham-Dodd Method | 0.01 | -100 |
| Graham Formula | n/a |
Sunrise Manufacture Group Co., Ltd. is a prominent vertically integrated textile and apparel manufacturer headquartered in Shengzhou, China. Operating across China, Vietnam, and Cambodia, the company manages a comprehensive supply chain from cotton planting and spinning to fabric production, dyeing, finishing, and garment manufacturing. Organized into Yarn, Fabric, Garment, and Other segments, Sunrise produces and sells a diverse range of products including knitted and woven garments, fabrics, and yarns. A notable strategic diversification includes entry into photovoltaic energy production, signaling a move towards sustainable operations. Founded in 2007 and listed on the Shanghai Stock Exchange, the company leverages its vertical integration to control quality and costs, serving both domestic and international markets. As a key player in the Consumer Cyclical sector, Sunrise Manufacture Group's performance is closely tied to global apparel demand, retail trends, and supply chain dynamics, positioning it as a significant manufacturer in the global textile industry.
Sunrise Manufacture Group presents a mixed investment profile. Positively, the company maintains a strong operating cash flow of CNY 607 million, significantly covering its capital expenditures and indicating healthy core operations. Its low beta of 0.511 suggests lower volatility compared to the broader market, which may appeal to risk-averse investors. However, significant concerns exist. The net income of CNY 46.6 million on revenue of CNY 3.67 billion translates to a very thin net profit margin of approximately 1.3%, highlighting intense competitive pressures and potential inefficiencies. Furthermore, the high total debt of CNY 2.2 billion relative to cash and equivalents of CNY 406 million raises leverage concerns. The modest dividend yield, while a returning capital, is underwhelming given the financial strain. Investment attractiveness is contingent on the company's ability to improve profitability and manage its debt load effectively in a competitive global apparel manufacturing landscape.
Sunrise Manufacture Group's competitive positioning is defined by its vertical integration, which is a key advantage allowing for control over the entire production process from raw material to finished garment. This integration can lead to cost efficiencies, quality control, and faster turnaround times, which are critical in the fast-paced apparel industry. Its geographic footprint, with operations in China, Vietnam, and Cambodia, allows it to leverage lower labor costs and mitigate risks associated with reliance on a single country, such as trade tariffs or geopolitical tensions. However, the company operates in a highly fragmented and competitive market. Its razor-thin profit margin of 1.3% is a clear indicator of severe price competition and its lack of significant pricing power. Unlike companies that compete on brand value, Sunrise is a pure-play manufacturer, making it a price-taker. The move into photovoltaic energy is a strategic diversification but is unlikely to materially impact its core competitive standing in textiles in the near term. Its primary competitive challenge is to differentiate its manufacturing services—through superior quality, reliability, or sustainability credentials—to command better margins. Without a strong brand or proprietary technology, its competitive advantage remains largely operational and cost-based, which is easily replicable by larger, more financially robust competitors with similar global footprints.