Breaking Down Jiangsu Hengli Hydraulic Co.,Ltd Financial Health: Key Insights for Investors

Jiangsu Hengli Hydraulic Co., Ltd. is posting eye-catching numbers that demand a closer look: Q3 revenue of 2.62 billion CNY (+24.53% YoY) and year-to-date revenue of 7.79 billion CNY (+12.31% YoY) accompany a Q3 net profit attributable to shareholders of 657.65 million CNY (+30.60% YoY) and a YTD net profit of 2.09 billion CNY (+16.49%), while trailing metrics-gross profit TTM of 3.98 billion CNY and an operating margin of 24.82%-underline healthy unit economics; investors should weigh this operational strength against valuation and liquidity signals such as a market capitalization of 91.08 billion CNY, a trailing P/E of 36.13 (forward 29.93), price-to-sales of 9.64 and robust cash and equivalents near 17.615 billion CNY, even as net operating cash flow for the first nine months fell to 1.06 billion CNY (-19.75% YoY); add to that a ROE (TTM) of 16.04%, a TTM revenue per share of 7.04 CNY, ambitious growth catalysts like a projected 13.4 billion CNY operating income target by 2027 from linear drive projects, 22.1% of 2024 revenue from overseas markets, and R&D investment exceeding 500 million CNY-details that make a nuanced read of Hengli's financial health essential for any investor considering exposure to this industrial leader.

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) Revenue Analysis

Jiangsu Hengli Hydraulic's recent revenue trajectory shows accelerating top-line growth across 2024-2025, supported by improving margins and solid quarterly momentum.

• Q3 2025 revenue: 2.62 billion CNY (+24.53% YoY)
• Q2 2025 revenue: 2.72 billion CNY (+13.7% QoQ)
• H1 2025 revenue: 5.17 billion CNY (+7% vs H1 2024)
• YTD through Q3 2025 revenue: 7.79 billion CNY (+12.31% YoY)
• Operating revenue 2024: 9.39 billion CNY (up 4.51% from 8.985 billion CNY in 2023)

Key revenue characteristics visible in the data:

• Mid-teens to mid-20s YoY growth in recent quarters (Q3 2025: +24.53%), indicating recovering demand and pricing power.
• Quarter-to-quarter improvement (Q2→Q3 2025 shows high sequential performance when combined with QoQ growth in Q2).
• Healthy profitability metrics alongside revenue gains: TTM gross profit of 3.98 billion CNY and an operating margin of 24.82% suggest effective cost and mix management.
• Revenue per share of 7.04 CNY (TTM) provides a per-share view of top-line scale for valuation comparisons.

Further context and investor-focused details are available here: Exploring Jiangsu Hengli Hydraulic Co.,Ltd Investor Profile: Who's Buying and Why?

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) - Profitability Metrics

• Q3 2025 net profit attributable to shareholders: 657.65 million CNY (+30.60% YoY).
• YTD net profit (to Q3 2025): 2.09 billion CNY (+16.49% YoY).
• Q3 2025 basic and diluted EPS: 0.49 CNY (+28.95% YoY); YTD EPS: 1.56 CNY (+16.42% YoY).
• Profit margin: 26.71%; Operating margin: 24.82% - indicating strong core profitability.
• Return on assets (TTM): 7.64%; Return on equity (TTM): 16.04%.
• Net interest margin after deductions (Q1 2025): 28.00% - +3.35 pp YoY and +5.77 pp MoM.
• Net income for H1 2025: 1.43 billion CNY with net income margin ≈ 27.7%.

• Margin profile: Operating margin at 24.82% and profit margin at 26.71% highlight strong conversion of revenue into earnings after operating costs and tax/finance effects.
• Capital efficiency: ROA of 7.64% and ROE of 16.04% indicate effective asset deployment and meaningful returns to equity holders.
• Earnings momentum: Double-digit YoY EPS and net income growth through Q3 2025 support improved per-share profitability.
• Interest & financing: The sharp rise in net interest margin after deductions in Q1 2025 (to 28.00%) suggests either higher earning spreads or favorable financing/valuation adjustments enhancing bottom-line contribution.

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) - Debt vs. Equity Structure

• Market capitalization: 91.08 billion CNY (as of 2025-07-01)
• Trailing P/E (TTM): 36.13
• Forward P/E: 29.93
• Price-to-Sales (TTM): 9.64
• Price-to-Book (MRQ): 5.55
• Enterprise Value / Revenue: 9.30
• Enterprise Value / EBITDA: 31.55
• Net asset per share: 11.77 CNY (2024), up 9.69% from 10.73 CNY (2023)
• Credit posture: stable investor sentiment implies moderate leverage (explicit debt ratios not disclosed)

• Implications for debt vs. equity: high market multiples and elevated EV/EBITDA indicate the market prices strong equity value and growth expectations; in the absence of explicit debt ratios, the combination of a sizable EV and stable credit perception suggests moderate leverage rather than aggressive indebtedness.
• Investor focus: valuation sensitivity to earnings performance-if EBITDA growth lags, the premium EV/EBITDA and P/E multiples could compress; conversely, continued net-asset growth and earnings expansion would justify current equity-rich valuation.
• Where to look next: analysts should reconcile enterprise value with total debt and cash to derive explicit debt/EBITDA and debt/equity ratios; check latest balance sheet and notes for off-balance-sheet items and short-term maturities.

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) - Liquidity and Solvency

• Net cash flow from operating activities (first 9 months 2025): 1.06 billion CNY (down 19.75% YoY)
• Operating cash flow (reported period): 2.7 billion CNY
• Cash and cash equivalents (peak recent period): ~17.615 billion CNY

• Strengths: large cash & equivalents (≈17.615 bn CNY) provides flexibility for working capital, debt servicing, and opportunistic investments.
• Risks: a 19.75% YoY decline in 9M 2025 net operating cash flow to 1.06 bn CNY signals reduced operational cash conversion that warrants monitoring.
• Stability signal: operating cash flow of 2.7 bn CNY underlines the company's ongoing ability to generate cash from core business lines despite YoY dip.

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) - Valuation Analysis

• Trailing P/E (TTM): 36.13 - indicates relatively high earnings multiple based on recent results.
• Forward P/E: 29.93 - reflects market expectations of EPS improvement.
• Price-to-Sales (TTM): 9.64 - suggests the stock trades at a strong premium to revenue.
• Price-to-Book (MRQ): 5.55 - signals valuation well above book value per share.
• Enterprise Value / Revenue: 9.30 - shows enterprise-level valuation relative to top-line.
• EV / EBITDA: 31.55 - denotes a high multiple on operating cash earnings.

• Premium multiples (P/S ~9.6, P/B ~5.6) imply expectations of above-market revenue growth, superior margins, or a scarcity/quality premium for Hengli's product mix and customer relationships.
• The gap between trailing and forward P/E (36.13 → 29.93) signals anticipated EPS growth baked into the price; investors should compare forecast drivers (volume, ASP, margin expansion) against company guidance and industry cycles.
• EV/EBITDA at 31.55 suggests limited upside from multiple expansion unless EBITDA grows materially; conversely, downside risk exists if margins compress or growth falters.
• Net asset per share rising to 11.77 CNY (2024) - a 9.69% increase from 2023 - indicates strengthening shareholder equity, supporting higher P/B ratios if returns on equity remain robust.
• Stable credit sentiment and inferred moderate leverage support the premium valuation, but absence of explicit debt ratios warrants checking latest balance sheet items and interest coverage before relying on this inference.

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) Risk Factors

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) reported net cash flow from operating activities of 1.06 billion CNY for the first nine months of 2025, a decline of 19.75% year‑over‑year. This deterioration in operating cash generation is a central risk signal for liquidity, investment capacity and financial flexibility.

• Operating cash flow contraction: 1.06 billion CNY for 9M2025, down 19.75% YoY - weaker cash conversion increases reliance on external financing and could limit capex or R&D spending.
• Working capital pressure: slower cash inflows often correlate with higher receivables or inventory buildup, elevating rollover and credit risks.
• Refinancing and interest rate sensitivity: reduced internal cash generation elevates refinancing needs; rising rates would increase interest burdens and compress net income.
• Market cyclicality and demand risk: hydraulic equipment is end‑market sensitive (construction, manufacturing, oil & gas); demand downturns would exacerbate cash strain.
• Supply chain and input-cost volatility: commodity or component price spikes can compress margins and further reduce operating cash flow.
• Customer concentration and credit risk: high exposure to a few large customers would magnify cash-flow disruption from late payments or order cancellations.

• Liquidity mitigation options to monitor:
  • Availability and terms of bank lines or committed facilities.
  • Ability to accelerate receivable collections or monetize inventory.
  • Asset sales or equity issuance dilutive risks.
• Investor watchpoints:
  • Quarterly operating cash flow trends vs. net income - divergence signals quality-of-earnings risk.
  • Changes in days sales outstanding (DSO) and inventory turnover.
  • Management disclosures on contingency plans, covenant waivers or refinancing timelines.

Further context on shareholder composition and buying trends can be found here: Exploring Jiangsu Hengli Hydraulic Co.,Ltd Investor Profile: Who's Buying and Why?

Jiangsu Hengli Hydraulic Co.,Ltd (601100.SS) - Growth Opportunities

• Linear drive product lineup: precision ball screws, planetary roller screws, linear guides - core components for robotics, electric actuators, and automated machinery.
• Projected operating income: CNY 13.4 billion by 2027 from linear drive and related electrification initiatives.
• R&D commitment: >¥500 million invested in 2024 to develop advanced hydraulic systems and smart technologies, targeting ~15% product-line efficiency improvements.

• International revenue share (2024): 22.1% from Europe & Americas.
• Mexican production: operational - shortens lead times and improves competitiveness in Western markets.
• Global markets insulate Hengli from single-market downturns while capturing higher-margin export opportunities.

• Dual growth drivers: cyclical recovery (e.g., excavator market) + structural transformation (product diversification, R&D, global footprint).
• Sustainability roadmap: 30% carbon reduction target by 2025 - aligns product demand with green infrastructure and corporate procurement standards.
• Innovation focus: smart hydraulics, electrified actuators, and efficiency gains create potential for margin expansion and new TAMs.