China New City Group SEHK 1321 Revenue Collapse Reinforces Bearish Earnings Narratives

China New City Group (SEHK:1321) has just posted its FY 2025 first half numbers, reporting revenue of C¥366.3 million and a basic EPS loss of C¥0.018, while the latest trailing twelve month figures show revenue of C¥739.7 million with a basic EPS loss of C¥0.143. Over recent periods the company has seen revenue move from C¥2.9 billion and EPS of C¥0.188 in 2024 H1 to C¥1.2 billion and EPS of C¥0.063 in 2024 H2, before stepping down to the current run rate. This sets up a story where top line scale and EPS pressure are now front and center for investors. With the company still unprofitable, the focus this season is firmly on how much margin resilience remains and what that signals about the path back toward firmer earnings quality.

See our full analysis for China New City Group.

With the headline figures on the table, the next step is to see how this earnings print lines up with the most widely held narratives about China New City Group, highlighting where the story is confirmed and where expectations may need a reset.

Curious how numbers become stories that shape markets? Explore Community Narratives

Revenue shrinks from C¥2.9b to C¥366m

• FY 2024 H1 revenue of C¥2.9b moved to C¥1.2b in 2024 H2 and then to C¥366.3m in 2025 H1, with net income shifting from a C¥377.8m profit in 2024 H1 to a C¥35.5m loss in 2025 H1.
• What stands out for a cautious view is that this step down in scale coincides with the trailing twelve month result moving from a C¥503.9m profit in 2024 H2 to a C¥276.2m loss by 2025 H2, which lines up with concerns about earnings quality when revenue is lower.
  • Bears highlight that even on a trailing basis, revenue is C¥739.7m against a loss of C¥276.2m, so profitability currently relies on a much smaller top line than seen in prior periods.
  • Critics also point to basic EPS swinging from C¥0.2506 in the 2024 H2 trailing set to a loss of C¥0.143 in the latest trailing twelve months, which keeps the focus on whether recent profitability was temporary.

From C¥0.19 EPS profit to recent losses

• Basic EPS moved from C¥0.1879 in 2024 H1 and C¥0.0627 in 2024 H2 to a small loss of C¥0.0177 in 2025 H1, while the latest trailing twelve month basic EPS shows a larger loss of C¥0.143 alongside net income of C¥276.2m in the red.
• Supporters of a more positive take often point to the longer term 23.8% annual decline in losses over five years, yet the most recent figures test that optimism because the company is unprofitable over the last twelve months despite reporting a C¥90.6m profit as recently as the 2025 H1 trailing set.
  • On the one hand, the five year trend of narrowing losses suggests progress when viewed over a longer stretch of time.
  • On the other, the move from trailing basic EPS of C¥0.2506 in 2024 H2 to a loss of C¥0.143 now shows that the near term pattern does not currently match that longer term improvement story.

To see how these mixed signals around profitability are being interpreted across different investor storylines, check the range of community views on China New City Group Curious how numbers become stories that shape markets? Explore Community Narratives.

Valuation gap and debt coverage risk

• At a share price of HK$0.48 and a DCF fair value of HK$0.06, the stock trades well above that cash flow based estimate. The P/S of 1.1x screens cheaper than peers at 2.0x but richer than the Hong Kong real estate industry average of 0.6x, and debt is not well covered by operating cash flow over the last twelve months.
• For a more cautious narrative, this mix of pricing and balance sheet data concentrates attention on risk, because the premium over the HK$0.06 DCF fair value and weaker debt coverage both rely on future cash generation that has not yet shown up in the latest trailing loss of C¥276.2m.
  • Skeptics argue that paying above a DCF fair value of HK$0.06 while operating cash flow has not covered debt in the last year leaves limited room for error if earnings do not improve.
  • Higher recent share price volatility compared with the Hong Kong market adds another layer, as it can magnify how quickly sentiment reacts to any further pressure on revenue or profit figures.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on China New City Group's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

With the story so far leaning toward caution, it makes sense to look through the figures yourself and decide how comfortable you are with the current risks and valuation. If you want to see what specific red flags others are watching, start with these 2 important warning signs.

See What Else Is Out There

China New City Group is facing shrinking revenue, recent losses and debt that is not well covered by operating cash flow, while the share price trades above DCF fair value.

If that mix of earnings pressure, balance sheet strain and pricing risk feels uncomfortable, you can quickly compare it with companies that screen stronger using the solid balance sheet and fundamentals stocks screener (384 results).

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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