| Valuation method | Value, HK$ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | n/a |
| Intrinsic value (DCF) | n/a | |
| Graham-Dodd Method | 0.10 | -58 |
| Graham Formula | 0.30 | 27 |
ZMFY Automobile Glass Services Limited is a specialized automotive aftermarket company providing comprehensive automobile glass solutions across China. Founded in 1999 and headquartered in Beijing, the company operates through 29 service centers, offering glass sales, installation, and repair services primarily for private and public motor vehicles. ZMFY serves a diverse customer base including insurance companies, car rental firms, and individual consumers, while also trading automobile glass to industry peers. The company has diversified into four business segments: Automobile Glass (core business), Photovoltaic System installation, Business Consultancy Services, and Finance Lease Services. Operating in the Consumer Cyclical sector's Auto Parts industry, ZMFY leverages its established service network to capture opportunities in China's massive automotive aftermarket. The company's integrated approach combining product sales with professional installation services positions it uniquely in the automotive glass replacement market, though it faces significant competition from both specialized glass providers and broader automotive service chains.
ZMFY Automobile Glass presents a high-risk investment proposition with concerning financial metrics. The company reported a net loss of HKD 20.66 million on revenue of HKD 80.47 million for FY 2020, representing negative profitability in a challenging operating environment. With negative operating cash flow of HKD 8.27 million and a diluted EPS of -HKD 0.026, the company's core operations appear strained. While the market capitalization of approximately HKD 187 million suggests some market confidence, the negative beta of -0.177 indicates unusual price movement patterns that may not correlate with broader market trends. The absence of dividends and the company's diversification into non-core segments (photovoltaic, consultancy, finance leasing) suggest management may be seeking alternative revenue streams amid automotive glass market challenges. Investors should carefully evaluate the company's path to profitability and competitive positioning before considering investment.
ZMFY operates in a highly competitive automotive glass aftermarket where scale, service network, and insurance company relationships are critical competitive advantages. The company's primary strength lies in its established network of 29 service centers across China, providing localized service capabilities that larger international players may not match in specific regions. Their integrated model combining glass sales with installation services creates customer convenience, particularly valuable for insurance company partnerships where claims processing efficiency is paramount. However, ZMFY faces significant competitive pressures from multiple fronts: large international automotive glass manufacturers with superior technical capabilities and economies of scale, national automotive service chains that can bundle glass services with other repairs, and local independent installers with lower cost structures. The company's relatively small scale (HKD 80M revenue) limits its purchasing power and ability to compete on price with larger competitors. Their diversification into photovoltaic and consultancy services suggests either strategic experimentation or distraction from core competencies. In the finance lease segment, they face competition from specialized financial institutions with greater capital resources. ZMFY's negative operating cash flow indicates potential competitive disadvantages in either pricing power or operational efficiency compared to more established players.