Earnings guidance puts China Risun Group in focus
China Risun Group (SEHK:1907) has issued earnings guidance for the first half of 2026, flagging an expected net profit attributable to shareholders between RMB 29 million and RMB 21 million.
The company also projects basic earnings per share in a range of RMB 0.1251 to RMB 0.0906. These figures give investors fresh data to assess the stock after recent share price weakness over the past month and past three months.
See our latest analysis for China Risun Group.
At a share price of HK$1.90, China Risun Group has seen its short term share price return pick up in recent days, but the share price is still down over the past quarter and the 1 year total shareholder return has also declined.
If this earnings update has you reassessing your exposure to materials and industrial supply chains, it can be useful to broaden your watchlist with other potential ideas such as 108 top founder-led companies
China Risun Group’s share price has slipped while analyst estimates and intrinsic value models sit much higher. The key issue now is how far that gap can reasonably close based on current assumptions.
Preferred P/E of 120.9x: Is it justified?
At HK$1.90, China Risun Group is trading on a P/E of 120.9x, which sits far above both its sector and peer averages, so the price already reflects a very full earnings multiple.
The P/E ratio compares the current share price with earnings per share and is often used as a shorthand for how much investors are willing to pay for each unit of current earnings. For a company like China Risun Group, operating across coke, coking chemicals and refined chemicals, a high P/E can indicate that the market is pricing in a strong earnings profile or expecting a sustained improvement in profitability.
Here though, the P/E of 120.9x is described as expensive not only versus the Hong Kong Chemicals industry average of 11.2x, but also versus the peer average of 9.2x and an estimated fair P/E of 17x. That leaves a wide gap between the current multiple and the level the market could move towards if expectations or sentiment around China Risun Group’s earnings normalise.
Explore the SWS fair ratio for China Risun Group
Result: Price-to-Earnings of 120.9x (OVERVALUED)
However, China Risun Group still faces risks if earnings fall short of guidance or if its high P/E multiple compresses as investor expectations adjust.
Find out about the key risks to this China Risun Group narrative.
Another view on China Risun Group’s value
The P/E of 120.9x paints China Risun Group as expensive, but our DCF model points the other way, with an estimated future cash flow value of HK$13.31 versus the current HK$1.90. That gap suggests the real question is which signal you trust more.
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out China Risun Group for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 236 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
Given the mixed signals around China Risun Group, it makes sense to look at the full picture yourself and decide how the balance of risk and reward stacks up for your portfolio. You can start with 3 key rewards and 2 important warning signs.
Looking for more investment ideas beyond China Risun Group?
If China Risun Group has sharpened your focus, do not stop there. Broaden your opportunity set with targeted stock ideas that match your preferred balance of risk and return.
- Target potential mispricings by scanning for quality businesses trading below their implied value using the 236 high quality undervalued stocks.
- Strengthen your income stream by focusing on companies with higher yields and resilient payout histories via the 469 dividend fortresses.
- Protect your capital by concentrating on steadier performers identified through the 293 resilient stocks with low risk scores.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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