Breaking Down Lianhe Chemical Technology Co., Ltd. Financial Health: Key Insights for Investors

Lianhe Chemical Technology's latest figures demand attention: Q3 2025 revenue jumped to CNY 1.57 billion (+13.61% QoQ) while TTM revenue through Sept 30, 2025 is CNY 6.04 billion (YoY +4.39%), set against a 2024 annual dip to CNY 5.68 billion from CNY 6.44 billion in 2023; profitability shows TTM net income of CNY 386.46 million (EPS CNY 0.42) and a gross margin of 27.17% with ROE at 6.43% and ROIC 3.07%; capital structure is moderate with debt/equity of 0.48, total debt CNY 3.44 billion and book value per share CNY 7.40, while liquidity metrics reveal a current ratio of 1.31 but a quick ratio of 0.71 and an Altman Z‑Score of 1.7 alongside a strong Piotroski F‑Score of 7; valuation multiples include a trailing P/E of 28.36, P/S 1.79 and EV/EBITDA 10.47, with the stock up 103.40% over 52 weeks and a beta of 0.73-dive into the full breakdown to see how these numbers translate into risks, opportunities and what analysts' 16.9% annual EPS growth forecast could mean for investors.

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Revenue Analysis

• Q3 2025 revenue: CNY 1.57 billion (up 13.61% vs. Q2 2025).
• TTM revenue as of 30‑Sep‑2025: CNY 6.04 billion (YoY +4.39%).
• 2024 annual revenue: CNY 5.68 billion (down 11.88% from CNY 6.44 billion in 2023).
• Revenue per employee: ~CNY 1.12 million (5,403 employees).
• Market capitalization: CNY 13.85 billion.
• Firm position: strong specialty-chemicals footprint with a diversified product mix supporting resilience amid volatility.

• Near-term revenue drivers: product mix optimization, selective price recovery, and incremental share gains in specialty segments.
• Risks to revenue trajectory: cyclical demand in downstream industries, raw material cost swings, and capacity additions by competitors.
• Investor consideration: valuation vs. market cap CNY 13.85 billion relative to TTM revenue CNY 6.04 billion (approx. EV/Revenue and margin sensitivities to monitor).

Lianhe Chemical Technology Co., Ltd. (002250.SZ) Profitability Metrics

The following section presents core profitability indicators and recent performance snapshots for Lianhe Chemical Technology Co., Ltd. (002250.SZ), highlighting trends investors should note.

• Q1 2025 net income: CNY 49.72 million (vs. CNY 2.69 million in Q1 2024)
• TTM net income (as of 2025-09-30): CNY 386.46 million; TTM EPS: CNY 0.42
• Full-year 2024 EBITDA: CNY 154.04 million; full-year 2024 net income: CNY 14.37 million
• Gross margin: 27.17%; Operating margin (EBIT margin): 8.81%; Profit margin (net margin): 6.40%
• EBIT: CNY 531.68 million (EBIT margin: 8.81%)
• Return on equity (ROE): 6.43%; Return on invested capital (ROIC): 3.07%

Key interpretive points for investors:

• Sharp YoY improvement in Q1 2025 net income suggests operational recovery or one-off gains driving short-term profitability.
• TTM net income and EPS indicate stronger recent earnings delivery compared with full-year 2024 results.
• Moderate gross and operating margins (27.17% and 8.81%) point to reasonable product-level profitability but limited operating leverage.
• ROE and ROIC (6.43% and 3.07%) imply moderate capital returns, highlighting potential room for efficiency improvements.

For additional context on shareholder composition and recent investor activity, see: Exploring Lianhe Chemical Technology Co., Ltd. Investor Profile: Who's Buying and Why?

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Debt vs. Equity Structure

Key capital-structure and liquidity metrics through November 2025 provide a snapshot of Lianhe Chemical Technology Co., Ltd.'s solvency, leverage and short-term coverage. The figures below reflect a moderate leverage profile with adequate operating coverage of interest and reasonable short-term liquidity.

• Debt-to-Equity Ratio: 0.48 - indicates a balanced capital structure with equity financing dominant over debt.
• Interest Coverage Ratio (EBIT / Interest): 4.41 - EBIT covers interest ~4.4x, showing comfortable interest payment capacity under current earnings.
• Total Debt: CNY 3.44 billion; Net cash position: CNY -2.28 billion (net debt).
• Equity (book value): CNY 7.09 billion; Book value per share: CNY 7.40.
• Current Ratio: 1.31 - sufficient short-term liquidity to meet near-term obligations.
• Debt-to-EBITDA: 2.66 - moderate leverage relative to operating cash generation.

• Implication for investors: the capital structure supports resilience to moderate shocks while leaving room for additional targeted borrowing or investment-funded growth.
• Risk considerations: net debt of CNY 2.28 billion signals exposure to interest-rate and refinancing risk if cash generation weakens; monitor EBITDA and interest coverage trends.
• Valuation context: book value per share (CNY 7.40) provides a tangible equity floor to compare against market price and intrinsic-value estimates.

Further context on corporate direction and strategic priorities is available here: Mission Statement, Vision, & Core Values (2026) of Lianhe Chemical Technology Co., Ltd.

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Liquidity and Solvency

Lianhe Chemical's short-term and long-term financial resilience presents a mixed picture: current liquidity appears adequate on a gross basis but strained on a more conservative measure, while leverage and bankruptcy-risk metrics signal caution.

• Current ratio: 1.31 - sufficient short-term assets to cover current liabilities, but not by a wide margin.
• Quick ratio: 0.71 - indicates reliance on inventory to meet near-term obligations; potential liquidity pressure if inventory cannot be converted quickly.
• Net cash position: CNY -2.28 billion - net debt, meaning total borrowings exceed cash and equivalents.
• Operating cash flow (TTM): CNY 1.23 billion; Capital expenditures: CNY 388.62 million; Free cash flow: CNY 843.06 million - positive FCF supports operations and debt servicing.
• Altman Z-Score: 1.7 - places the company in a zone associated with higher bankruptcy risk.
• Piotroski F-Score: 7 - suggests relatively strong fundamental financial health in profitability, leverage/ liquidity, and operating efficiency tests.

Key considerations for investors:

• Positive free cash flow (CNY 843.06M) provides a buffer to service the CNY 2.28B net debt, but continued cash generation is critical.
• The Altman Z-Score of 1.7 warrants monitoring of capital structure and earnings volatility despite a healthy Piotroski F-Score of 7.
• Short-term liquidity depends on inventory convertibility given the quick ratio of 0.71; working-capital management is a focal point.

For broader context on the company's background, ownership and how it makes money see: Lianhe Chemical Technology Co., Ltd.: History, Ownership, Mission, How It Works & Makes Money

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Valuation Analysis

• Trailing P/E: 28.36 - reflects historical earnings multiple investors currently pay.
• Forward P/E: 27.27 - indicates slightly lower expected multiple based on projected earnings.
• P/S: 1.79 and P/B: 1.52 - suggesting moderate revenue and book-value backing per share.
• EV/EBITDA: 10.47 and EV/FCF: 16.02 - enterprise-value based metrics showing the company's operating cash/earnings valuation.
• Market cap: CNY 10.79 billion; Enterprise value: CNY 13.51 billion - absolute size measures used for relative comparisons.
• 52-week price change: +103.40% - strong market appreciation over the last year.
• Beta: 0.73 - lower volatility vs. the broader market, implying defensive characteristics.

• Relative valuation takeaway: P/E and EV multiples indicate the market is assigning a premium consistent with growth expectations and recent share-price momentum.
• Liquidity & size context: market cap CNY 10.79B places the company in the small-to-mid cap range, while EV adjustments capture net debt impact on valuation.
• Volatility and risk: beta 0.73 suggests returns historically less volatile than the market, which may attract risk-averse investors.

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Risk Factors

• Balance-sheet risks: An Altman Z-Score of 1.7 places Lianhe in a zone typically associated with heightened default probability; combined with a net cash position of CNY -2.28 billion, leverage and refinancing exposure are material concerns.
• Liquidity risks: The quick ratio of 0.71 indicates current quick assets cover less than one unit of current liabilities, raising the possibility of short-term funding pressure, especially if working capital turns adverse.
• Operational/quality mitigants: A Piotroski F-Score of 7 signals good earnings quality, improving ROA, and sound accruals and leverage trends - factors that reduce default likelihood compared with peers at similar leverage levels.
• Market cyclicality: As a player in the global chemical industry, Lianhe is vulnerable to feedstock price volatility, global demand cycles (industrial output, construction, automotive), and margin compression in downturns.
• Regulatory and geopolitical risks: Environmental, safety, export-control, and trade-policy changes in China and export markets can create compliance costs, capex burdens, or restrict market access, amplifying downside in stressed scenarios.

• Credit and interest-rate sensitivity: With net debt of CNY 2.28 billion, rising interest rates or tighter credit conditions would increase financing costs and could pressure liquidity covenants.
• Refinancing timeline: Concentrations of upcoming maturities or reliance on short-term facilities would heighten susceptibility to market disruptions; monitoring debt maturity schedule and available unencumbered liquidity is essential.
• Counterparty and supply-chain risk: Disruptions among feedstock suppliers or major customers could quickly impair cash flow given modest quick-assets coverage.

• Quarterly movement in Altman Z-Score and Piotroski F-Score components (profitability, leverage, liquidity, accruals).
• Trend in quick ratio and working-capital turnover; any widening of payable/receivable days.
• Change in consolidated net debt and interest-coverage metrics.
• Announcements on regulatory rulings, environmental compliance expenditures, or export/trade restrictions.
• Exposure to feedstock price swings and end-market demand indicators (chemical prices, PMI, auto/construction demand).

Lianhe Chemical Technology Co., Ltd. (002250.SZ) - Growth Opportunities

Lianhe Chemical Technology is positioned for multi-front expansion driven by geographic scale-up, sustainable product shifts, and a diversified portfolio spanning crop protection, pharmaceuticals, and performance chemicals. Key consensus metrics and market capitalization underpin investor confidence in the company's ability to execute growth initiatives.

• Global expansion: significant investment in a Malaysian facility to serve ASEAN markets and improve logistics and local production capacity.
• Sustainability focus: active development and commercialization of biopesticides and other lower-environmental-impact chemistries aligned with tightening global regulatory and market preferences.
• Product diversity: multiple end-markets (crop protection, pharmaceuticals, performance chemicals) mitigate single-market cyclicality and open cross-selling and R&D leverage opportunities.
• Analyst expectations: earnings growth forecast at 16.9% per annum and revenue growth forecast at 16.7% per annum, reflecting both organic demand and capacity-driven gains.
• Market validation: market capitalization of CNY 10.6 billion and an analyst consensus 'Buy' rating indicate prevailing market and professional optimism.

Primary growth levers include scale-up of the Malaysian facility to capture ASEAN demand, accelerating commercialization of biopesticides to meet sustainability-driven premium demand, and cross-segment synergies from a diversified product slate. For investor context and shareholder composition detail, see: Exploring Lianhe Chemical Technology Co., Ltd. Investor Profile: Who's Buying and Why?