CK Infrastructure Holdings Limited (1038.HK) stock analysis

In our weekly check, CK Infrastructure Holdings Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 14 pass, warnings: 3, red flags: 8.

About CK Infrastructure Holdings Limited

CK Infrastructure Holdings Limited is an Utilities company (Regulated Electric) based in Hong Kong, listed on HKSE as 1038.HK.

What our checks show for 1038.HK

Red flags

• Net debt is 43.7x a year of EBITDA (debt/equity 0.14). That limits room in a downturn and raises refinancing risk.
• Operating profit does not cover the interest bill (0x): interest is paid from cash or new debt.
• The gross margin fell by 31 points, to 3.3%: costs are rising faster than prices.
• Operating cash flow is only 0.25x net profit: part of the reported profit does not arrive as cash.
• Analysts expect the net margin to shrink by 9.3 points from today's 197%.
• Revenue fell 12.6% a year over the last 3 years.
• The dividend takes 588% of profit: little cushion if profit falls.
• Return on capital (ROCE) is zero or negative: the business does not earn on the money put into it.

Warning signs

• Analysts expect only about 1.4% a year of growth in revenue.
• The stock has fallen as much as 56% from a peak. Would you have held through that?
• The stock is still below its previous peak.

Strengths

• The net margin rose by 90.4 points over 5 years, to 197%.
• The company keeps 197% of its revenue as net profit.
• Free cash flow is 42.5% of revenue: cash for dividends, buybacks or growth.
• The price is 6.7 times earnings (P/E), reasonable for its growth.
• A large company: market value $21.62 billion.
• Pay in shares is only 0% of free cash flow.

Similar companies

NEE · 0002.HK · AXIA3.SA · SO · DUK · NGG

Questions

What grade does CK Infrastructure Holdings Limited (1038.HK) have?

In our weekly check, CK Infrastructure Holdings Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 14 pass, warnings: 3, red flags: 8. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of 1038.HK stock?

This week's biggest flags for CK Infrastructure Holdings Limited: High debt, Weak interest cover, Gross margin falling. In total 11 of 25 checks show a warning or a red flag.

What does CK Infrastructure Holdings Limited do?

CK Infrastructure Holdings Limited is an Utilities company (Regulated Electric) based in Hong Kong, listed on HKSE as 1038.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 2026-10-24

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