Raytech Holding Ltd (RAY) Stock Analysis and Metrics

Sector: Consumer Defensive Industry: Household & Personal Products CIK: 0001948443

Market Cap 6.28 Mn

P/B 0.42

P/E 5.84

P/S 0.67

ROIC (Qtr) 0.00

Div Yield % 0.00

Rev 1y % (Qtr) 0.00

Total Debt (Qtr) 0.00

Debt/Equity (Qtr) 0.00

About

Raytech Holding Ltd, also known by its stock symbol RAY, operates in the personal care electrical appliance industry. The company was established in Hong Kong in 2013 and has since grown to become a key player in the sector. Raytech Holding Ltd specializes in the design, development, and wholesaling of personal care electrical appliances, with a robust research and development team that boasts over 16 years of experience in electrical appliances engineering and supply chain management. The company's primary business activities revolve around the...

Raytech Holding Ltd, also known by its stock symbol RAY, operates in the personal care electrical appliance industry. The company was established in Hong Kong in 2013 and has since grown to become a key player in the sector. Raytech Holding Ltd specializes in the design, development, and wholesaling of personal care electrical appliances, with a robust research and development team that boasts over 16 years of experience in electrical appliances engineering and supply chain management.

The company's primary business activities revolve around the personal care electrical appliance industry. Raytech Holding Ltd has a strong presence in this sector, thanks to its emphasis on hair styling products and its decade-long operating history. The company's reputation in the industry has been built over the years and has been further strengthened by the recognition of its founder, Mr. Ching, in the HKEAIA Express Magazine in 2017 and 2019.

Raytech Holding Ltd generates revenue through the sourcing and wholesaling of personal care electrical appliances. Its product portfolio includes hair styling series, trimmer series, eyelash curler series, neck care series, nail care series, and other personal care appliances. The company's hair styling series is its largest revenue-generating segment, accounting for 38%, 62%, and 48% of its total revenue for the years ended March 31, 2022, 2023, and 2024, respectively. The company's hair dryers are particularly popular, with 66%, 44%, and 37% of its hair styling series sales coming from hair dryers for the years ended March 31, 2022, 2023, and 2024, respectively.

The trimmer series is another significant revenue-generating segment, accounting for 22%, 19%, and 34% of the company's total revenue for the years ended March 31, 2022, 2023, and 2024, respectively. The company's men shaver, women's epilator shaver, and foil shaver are popular products in this series.

Raytech Holding Ltd's competitive advantage lies in its strong presence in the personal care electrical appliance industry and its focus on hair styling products. The company's relationships with its collaborating manufacturers, such as Zhongshan Raytech Electrical Appliances Manufacturing Co. Ltd. and Zhongshan Leimi Electrical Appliances Company Limited, have been long-term and mutually beneficial.

The company's customers are primarily international brand owners of personal care electrical appliances, such as Koizumi Seiki Corp., one of the top 10 sellers in terms of retail volume in the personal care electrical appliance market in Japan. Raytech Holding Ltd generated 97.8%, 91.3%, and 74.1% of its total revenue, respectively, from Koizumi Seiki Corp. for the years ended March 31, 2022, 2023, and 2024.

Raytech Holding Ltd does not currently own any trademarks, copyrights, patents, domain names, know-how, proprietary technologies, or similar intellectual property. The company is subject to various laws and regulations in Hong Kong, including the Business Registration Ordinance, the Employment Ordinance, the Employees' Compensation Ordinance, the Inland Revenue Ordinance, the Consumer Goods Safety Ordinance, the Electrical Products (Safety) Regulation, the Occupational Safety and Health Ordinance, the Trade Description Ordinance, the Trade Marks Ordinance, and the Sale of Goods Ordinance.

Price action

Investment thesis

Bull case

Tangible assets of 18.82M provide exceptional 52.77x coverage of deferred revenue 356541.26, showing strong service capability backing.
Tangible assets of 18.82M provide robust 26.96x coverage of other current liabilities 697867.22, indicating strong asset backing.
Operating cash flow of 661542.80 provides strong 3.95x coverage of tax liabilities 167645.89, showing excellent fiscal position.
Strong cash position of 15.62M provides 22.39x coverage of other current liabilities 697867.22, indicating excellent liquidity.
Retained earnings of 5.65M provide strong 8.10x coverage of other current liabilities 697867.22, indicating earnings quality.

Bear case

Operating cash flow of 661542.80 provides minimal 1.67x coverage of tax expenses of 395857.33, suggesting potential tax planning inefficiencies or unsustainable tax positions.
Operating cash flow of 661542.80 is outpaced by equity issuance of 4.63M (0.14 ratio), indicating concerning reliance on equity markets for funding operations.
Tax assets of 0 provide limited offset against tax liabilities of 167645.89, which is 0x, indicating potential future cash flow pressure from tax obligations.
Tangible assets of 18.82M provide limited backing for working capital of 15.03M, which is 1.25x, suggesting increased operational risk in market downturns.
R&D investment of 0 represents just 0x of SG&A expenses of 1.30M, indicating potential underinvestment in innovation relative to administrative overhead.

Peer comparison

Companies in the Household & Personal Products

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	PG	PROCTER & GAMBLE Co	401.54 Bn	29.00	5.43	36.64 Bn
2	UL	Unilever Plc	182.31 Bn	22.43	2.85	-
3	CL	Colgate Palmolive Co	78.47 Bn	52.42	4.20	8.42 Bn
4	KMB	Kimberly Clark Corp	35.97 Bn	19.97	1.96	7.30 Bn
5	EL	Estee Lauder Companies Inc	34.41 Bn	-193.32	2.35	9.39 Bn
6	KVUE	Kenvue Inc.	34.07 Bn	23.78	2.27	8.97 Bn
7	CHD	Church & Dwight Co Inc /De/	25.66 Bn	58.49	7.25	2.20 Bn
8	CLX	Clorox Co /De/	14.46 Bn	19.15	2.14	3.22 Bn

Industry comparisons

Current Valuation	Value	Ind Avg
EV to Assets EV to Assets	-0.74	1.51
EV to Cash from Ops. EV/CFO	-21.03	11.18
EV to Debt EV to Debt	0.00	4.46
EV to EBIT EV/EBIT	-9.46	22.50
EV to EBITDA EV/EBITDA	-14.14	5.19
EV to Free Cash Flow [EV/FCF] EV/FCF	-21.03	29.65
EV to Market Cap EV to Market Cap	-2.22	-1.73
EV to Revenue EV/Rev	-1.48	2.27
Price to Book Value [P/B] P/B	0.42	-46.60
Price to Earnings [P/E] P/E	5.84	15.50

Dividend Metrics	Value	Ind Avg	Percentile
Dividend Coverage Ratio Dividend Coverage Ratio	0.00	8.97
Dividend Payout Ratio % Dividend Payout Ratio %	0.00	5.07
Dividend per Basic Share Div per Share (Qtr)	0.00	0.95
FCF Dividend Payout Ratio % FCF Dividend Payout Ratio %	0.00	10.73
Interest Coverage Interest Coverage	0.00	2.60

Growth Metrics	Value	Ind Avg
Capex Growth (1y) % Capex Growth (1y) %	0.00	-97.30
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr)	50.35	5.93
Dividend Growth (1y) % Dividend Growth (1y) %	0.00	-0.27
EBIAT Growth (1y) % EBIAT Growth (1y) %	2.65	-154.67
EBITDA Growth (1y) % EBITDA Growth (1y) %	0.00	-119.65
EBIT Growth (1y) % EBIT Growth (1y) %	13.17	-149.91
EBT Growth (1y) % EBT Growth (1y) %	13.18	-226.50
EPS Growth (1y) % EPS Growth (1y) %	-24.97	-132.37
FCF Growth (1y) % FCF Growth (1y) %	163.75	27.80
Gross Profit Growth (1y) % Gross Profit Growth (1y) %	21.09	-2.04

Liquidity Ratios	Value	Ind Avg
Asset Utilization Ratio Asset Utilization Ratio	0.06	0.82
Cash Payout Ratio Cash Payout Ratio	0.00	0.19
Cash Ratio Cash Ratio (Qtr)	4.22	0.75
Current Ratio Curr Ratio (Qtr)	5.07	2.30
Debt to Equity Ratio Debt/Equity (Qtr)	0.00	1.13
Interest Cover Ratio Interest Cover Ratio	0.00	2.60
Times Interest Earned Times Interest Earned	0.00	2.60

Profitability	Value	Ind Avg
EBITDA Margin % EBITDA Margin %	0.00	-32.80
EBIT Margin % EBIT Margin %	121.87	-37.22
EBT Margin % EBT Margin %	15.66	-40.91
Gross Margin % Gross Margin %	25.40	50.08
Net Profit Margin % Net Profit Margin %	11.40	-43.08

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