1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Metrics vs Peers
3. Price Chart
4. Valuation
5. Offer Terms
6. Financial Statements
Discussion
Research report, target price, DCF and forensic scores are for subscribers. View plans
Symbol
HLP
Listed on
2023-03-29
Sector
Industrials
Subsector
Machinery
Offer Price
$4.00
Shares Offered
2.06M
12.06M
$48.3M
17.1%
Implied Upside vs Midpoint
Description
We are an offshore holding company incorporated in the Cayman Islands. As a holding company with no material operations of our own, we consolidate financial results of Hongli Shandong, the VIE and its subsidiaries through Contractual Arrangements. Neither we nor our subsidiaries own any equity interests in the PRC operating entities. This is an offering of the Ordinary Shares of the offshore holding company. You are not investing in the PRC operating entities. Neither we nor our subsidiaries own any equity interest in Hongli Shandong. Instead, we consolidate financial results of Hongli Shandong through a series of Contractual Arrangements dated April 12, 2021. The PRC operating entities are one of the leading cold roll formed steel profile manufacturers in China with respect to function innovation, performance improvement, and customized manufacturing of their products, according to China Sub-Association for Cold Formed Steel Industries, a professional industrial association. The PRC operating entities’ main business operation focuses on the design, production, deep processing, and sales of custom-made profile for machinery and equipment in a variety of sectors including but not limited in mining and excavation, construction, agriculture, and transportation industries. With more than a 20-year operating history, the PRC operating entities have developed customers in more than 30 cities in China and a global network covering South Korea, Japan, the U.S., and Sweden. The customers of the PRC operating entities including large corporations and international enterprises such as Weichai LOVOL Heavy Industry Co. Ltd. (“LOVOL”), SUNGJIN TECH CO., LTD (“South Korean VOLVO”), Shandong Lingong Construction Machinery Co., Ltd. (“SDLG”), and some new customers associated with Katsushiro Machinery Co., Ltd. (“Japan Katsushiro”). Most of the customers of the PRC operating entities have been with them for an average of 10 years. Most of the main customers increased orders with the PRC operating entities during the fiscal years ended 2020 and 2019, and based on their new contracts with the PRC operating entities recently, they will continue to increase their orders in the next 2-3 years. --- Our principal executive office is located at Beisanli Street, Economic Development Zone, Changle County, Weifang, Shandong, China 262400. Our telephone number is +86 0536-2185222. Our website is www.hlyxgg.com.
▲ Cheaper than its peers on 2 of 2 valuation measures
| Metric | Value | Peer median | Among peers | Trend |
|---|---|---|---|---|
EV / revenue | 2.2x | 8.1x | ||
Price / earnings | 15.1x | 42.7x | ||
Revenue growth | 94.6% | 73.5% | ||
Gross margin | 35.3% | 36.5% | ||
Operating margin | 18.1% | -6.2% | ||
Net margin | 14.7% | -8.3% | ||
Free cash flow margin | 0.6% | -2.8% | ||
Rule of 40 | 115% | 35.3% | ||
Net cash / market cap | -10.7% | 0.7% | ||
Debt / equity | 0.49 | 0.00 | ||
Current ratio | 1.18 | 1.55 | ||
9 premium metrics: DCF value / price, Growth the price needs: how common, Last 12 months vs full year and 6 more Unlock | ||||
Each filing is plotted ahead of the first trading day on the price chart.
| Filed | Form | Price range | Price | Shares offered | Deal size |
|---|---|---|---|---|---|
| 2022-03-31 | F-1/A | — | $5.00 | 17,999,900 | $90.0M |
| 2022-06-17 | F-1/A | — | — | 17,999,900 | — |
| 2022-07-15 | F-1/A | — | — | 17,999,900 | — |
| 2022-09-14 | F-1/A | — | — | 17,999,900 | — |
| 2022-09-20 | F-1/A | — | — | 17,999,900 | — |
| 2022-09-30 | F-1/A | — | — | 17,999,900 | — |
| 2022-10-17 | F-1/A | — | — | 17,999,900 | — |
| 2022-10-26 | F-1/A | — | — | 17,999,900 | — |
| 2022-11-03 | F-1/A | — | — | 17,999,900 | — |
| 2022-12-05 | F-1/A | — | — | 17,999,900 | — |
| 2023-02-10 | F-1/A | — | — | 17,999,900 | — |
| 2023-02-17 | F-1/A | — | — | 17,999,900 | — |
| 2023-02-27 | F-1/A | — | — | 17,459,903 | — |
| 2023-03-23 | F-1/A | — | — | 17,459,903 | — |
| 2023-03-30 | 424B4 | — | $4.00 | 2,062,500 | $8.3M |
Hongli Group Inc. income statement and balance sheet, FY Dec 2022 to FY Dec 2025, as reported in SEC filings.
| Metric | FY Dec 2022 | FY Dec 2023after listing | FY Dec 2024after listing | FY Dec 2025after listing |
|---|---|---|---|---|
| Revenue | $20.3M | $16.0M | $14.1M | $19.6M |
| Gross profit | $7.0M | $5.2M | $4.5M | $6.4M |
| Operating income | $2.9M | $1.0M | ($1.6M) | $2.4M |
| Net income | $2.9M | $865K | ($1.9M) | $1.9M |
| Revenue growth | — | −21.1% | −11.8% | 39.0% |
| Gross margin | 34.6% | 32.8% | 32.0% | 32.5% |
| Operating margin | 14.4% | 6.4% | −11.2% | 12.4% |
| Net margin | 14.5% | 5.4% | −13.3% | 9.9% |
| Metric | FY Dec 2022 | FY Dec 2023after listing | FY Dec 2024after listing | FY Dec 2025after listing |
|---|---|---|---|---|
| Total assets | $36.2M | $32.1M | $65.0M | $72.2M |
| Total liabilities | $22.7M | $11.0M | $11.5M | $14.4M |
| Total equity | $13.5M | $21.1M | $53.5M | $57.8M |
| Cash & equivalents | $2.1M | $776K | $910K | $1.8M |