002725.SZ(002725.SZ)

$11.15—

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002725.SZ(002725.SZ)

SHZ

$11.15—

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002725.SZ(002725.SZ)

002725.SZ

Overview Notebook Intelligence Chart History Fundmntls TTM Earnings Analysts News Financials Segments Insiders Institl.DCF Peers

8/4/26

ZHEJIANG YUELING (002725.SZ)

Tuesday

9:53 AM

Thesis: Recent declines in net income and consumer sentiment suggest a challenging environment for Zhejiang Yueling, raising concerns about future profitability.

Revenue Outlook

Metric	FY2024	FY2025
Revenue	$708M	$665M
Rev. Growth	+10.7%	-6.1%
EPS	$0.18	$0.06
EPS Growth	+190%	-68.4%
P/E	61.9×	196.0×

What Could Go Wrong

1Declining consumer sentiment in China may lead to reduced vehicle sales, negatively impacting parts demand.
2The company's net income has dropped significantly, raising concerns about its ability to maintain dividend payments.
3Technological disruption from electric vehicles could reduce demand for traditional automotive parts.
4Regulatory changes regarding emissions and safety standards may necessitate costly adjustments.
5Increased competition from low-cost manufacturers in Southeast Asia.
6Potential market share loss to larger, more diversified automotive suppliers.
7Low return on equity suggests inefficiencies in capital utilization.
8Potential liquidity issues if cash flow does not improve amid declining revenues.

FY2025 Snapshot

Revenue: $665M
Rev. Growth: -6.1%
Gross Margin: 12.2%
Op. Margin: 1.9%
Net Margin: 2.2%
Net Income: $15M
NI Growth: -69.1%
EPS: $0.06
1Y Return: -19.7%

002725.SZ Chart

My Notes

"Management indicated, 'We are facing significant headwinds in both production costs and market demand.'"
Moat: The company's focus on R&D and quality provides a moderate competitive advantage, but it is vulnerable to price competition.
Watch: Emerging competitors from Southeast Asia are increasingly targeting the same market segments with lower-cost products.
value - Investors may be attracted to the stock for its low valuation metrics despite current challenges.
Moderate - While interest rates primarily affect consumer financing for vehicle purchases…
Watch on earnings: Domestic automotive production levels, Raw material price indices for rubber and plastics, Gross margin percentage.

One Sentence Summary:

The bear case: declining consumer sentiment in china may lead to reduced vehicle sales, negatively impacting parts demand.

Auto-composed from Stock Alarm intelligence, financial statements, and analyst estimates. Not investment advice.

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Metric

FY2024

FY2025

P/E

61.9×

196.0×

What Could Go Wrong

1Declining consumer sentiment in China may lead to reduced vehicle sales, negatively impacting parts demand.

2The company's net income has dropped significantly, raising concerns about its ability to maintain dividend payments.

3Technological disruption from electric vehicles could reduce demand for traditional automotive parts.

4Regulatory changes regarding emissions and safety standards may necessitate costly adjustments.

5Increased competition from low-cost manufacturers in Southeast Asia.

6Potential market share loss to larger, more diversified automotive suppliers.

7Low return on equity suggests inefficiencies in capital utilization.

8Potential liquidity issues if cash flow does not improve amid declining revenues.

My Notes

"Management indicated, 'We are facing significant headwinds in both production costs and market demand.'"

Moat: The company's focus on R&D and quality provides a moderate competitive advantage, but it is vulnerable to price competition.

Watch: Emerging competitors from Southeast Asia are increasingly targeting the same market segments with lower-cost products.

value - Investors may be attracted to the stock for its low valuation metrics despite current challenges.

Moderate - While interest rates primarily affect consumer financing for vehicle purchases…

Watch on earnings: Domestic automotive production levels, Raw material price indices for rubber and plastics, Gross margin percentage.