China Conch Venture Holdings Limited (0586.HK) stock analysis

In our weekly check, China Conch Venture Holdings Limited is graded D (A to F). Of 25 checks on debt, profit, cash flow and trend: 9 pass, warnings: 6, red flags: 10.

About China Conch Venture Holdings Limited

China Conch Venture Holdings Limited is an Industrials company (Industrial - Pollution & Treatment Controls) based in China, listed on HKSE as 0586.HK.

What our checks show for 0586.HK

Red flags

• Net debt is 9.8x a year of EBITDA (debt/equity 0.59). That limits room in a downturn and raises refinancing risk.
• Operating profit does not cover the interest bill (0.4x): interest is paid from cash or new debt.
• The net margin fell by 77.3 points over 5 years, to 34.3%: the company keeps less of each sale as profit.
• Analysts expect the net margin to shrink by 11.9 points from today's 34.3%.
• Revenue fell 6.1% a year over the last 3 years.
• Free cash flow is negative (-2.6% of revenue): the business spends more cash than it brings in.
• The dividend takes 189% of profit: little cushion if profit falls.
• The stock has fallen as much as 86% from a peak. Would you have held through that?
• Return on capital (ROCE) is only 1.8%.
• Pay in shares equals 0% of free cash flow: it dilutes shareholders.

Warning signs

• Operating cash flow is only 0.65x net profit: part of the reported profit does not arrive as cash.
• Earnings per share fell 14.6% a year over the last 3 years.
• Net profit fell 16.5% a year over the last 3 years.
• A small company (market value $1.71 billion): usually riskier and followed by fewer analysts.
• The price swings a lot: 43% annual volatility. Expect large ups and downs.
• The stock is still below its previous peak.

Strengths

• The gross margin is 34.7% and has risen by 10 points: pricing power is holding.
• Analysts expect revenue to grow about 24.2% a year over the next years.
• The company keeps 34.3% of its revenue as net profit.
• The price is 6 times earnings (P/E), reasonable for its growth.
• The share count fell by 6.2% in 2 years: the company buys back its own shares.
• Actively traded: about 4.7 million shares a day.

Similar companies

VLTO · EMBJ · QAN.AX · HLMA.L · ATRL.TO · BVI.PA

Questions

What grade does China Conch Venture Holdings Limited (0586.HK) have?

In our weekly check, China Conch Venture Holdings Limited is graded D (A to F). Of 25 checks on debt, profit, cash flow and trend: 9 pass, warnings: 6, red flags: 10. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of 0586.HK stock?

This week's biggest flags for China Conch Venture Holdings Limited: High debt, Weak interest cover, Margins falling. In total 16 of 25 checks show a warning or a red flag.

What does China Conch Venture Holdings Limited do?

China Conch Venture Holdings Limited is an Industrials company (Industrial - Pollution & Treatment Controls) based in China, listed on HKSE as 0586.HK.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-31

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