| After years of post-pandemic recovery efforts, Hong Kong is still faced with sluggish growth in 2025, with GDP expansion hampered by a cooling property market, reduced investments from Mainland China, and global trade uncertainties. The construction sector has been hit by higher borrowing costs and delays in public infrastructure projects. Yet, the Hong Kong Government’s initiatives to boost housing supply and infrastructure, alongside a push for sustainability, offer glimmers of hope. |
Yee Hop Engineering helped build the Gleneagles Hospital in Hong Kong.
Photo: Company
| Yee Hop positions for recovery |
Yee Hop Holdings (HKEx stock code: 1662) is principally engaged in core businesses of foundation and civil engineering works, tunneling, and a newer segment in aquatic product trading.
We believe the Group’s ability to achieve a turnaround hinges on leveraging its strengths, adapting to market conditions, and capitalizing on emerging opportunities.
Historically, Yee Hop has shown resilience:
 • For the half-year ending September 30, 2022, it reported sales of HK$341.64 million and a net profit of HK$16.66 million, reversing a loss from the prior year.• Profit attributable to the owners of the Company for FY2024 amounted to HK$22.1 million (+83% year-on-year) • For the six months to September 2024, it reported attributable profit of HK$32.4 million (+231% year-on-year). |
However, earlier periods (e.g., 2021) saw losses, reflecting sensitivity to economic cycles and project delays.
Its recent stock price hovered around HK$2.30 with a 1 year retun of 47%. The 52-week range of HK$1.01 to HK$2.50 signals volatility.
| Current position |
Yee Hop’s expertise in foundation and tunneling works aligns with these priorities.
By securing contracts for public works, historically a strength for Yee Hop, the Company can stabilize revenue.
|
Stock price (HK$) |
2.30 |
|
52-week range |
1.51 – 2.93 |
|
Market cap |
$1.15 b |
|
PE (trailing) |
29 |
|
Dividend yield |
- |
|
1-year return |
47% |
|
Source: Yahoo! |
|
For instance, foundation works for new residential developments or tunneling for rail extensions could offset private-sector slowdowns.
Actively bidding on these projects, even at competitive rates, ensures cash flow and keeps its workforce engaged.
Yee Hop has shown room in the past for further tightening in its cost structure, namely optimizing resource use, renegotiating supplier contracts, and adopting technology like automated machinery to reduce labor dependency.
Its 2022 profit turnaround suggests some success in this area, likely from streamlining operations after earlier losses. Maintaining this discipline is key to weathering economic pressure and funding growth initiatives.
| Opportinities in Green Construction |
Yee Hop Holdings, through its subsidiary Absolute Pure EnviroSci Limited (APEL), entered into a joint venture with Guangzhou Guofa Building Technology Co., Ltd. in Oct 2024.
This partnership focuses on developing eco-friendly, multifunctional building materials aimed at promoting sustainable construction and carbon neutrality in Hong Kong and the Greater Bay Area.
The initiative aligns with China's broader goals for green, low-carbon development and aims to enhance the environmental performance of buildings while addressing health concerns for humans and pets
Global and local pushes for green construction provide a niche for Yee Hop. Its civil engineering skills could pivot toward eco-friendly projects, in areas such as sustainable site formation or energy-efficient infrastructure.
Hong Kong’s 2050 carbon neutrality goal encourages such shifts, and Yee Hop is suitably placed to position itself as a partner for green developers, potentially unlocking grants or premium contracts. This aligns with the “new productive forces” trend, blending innovation with environmental goals.
The construction sector increasingly favors technology, such as drones for site surveys, AI for project planning. Yee Hop’s traditional approach risks obsolescence.
Investing in such tools, even modestly, could boost efficiency and appeal to modern clients, supporting a turnaround by differentiating it from rivals.
| Stock Dynamics |
With a profit base at HK$32.4 million for the six months to September 2024, Yee Hop’s turnaround requires bolstering its balance sheet, possibly through equity financing or strategic partnerships.
Collaborating with larger firms on joint ventures could fund bigger projects without over-leveraging, while preserving its independence.
Yee Hop’s stock volatility, meanwhile, reflects low liquidity and investor awareness.
A turnaround needs a stronger market profile, entailing efforts like more transparent reporting, investor outreach, or even a rebranding to highlight its green and diversified offerings.
Its 30% stock rise in late 2024 shows momentum; sustaining this through consistent performance could rebuild confidence.
In summary, by concentrating on government projects, tightening costs, growing its green business, and embracing sustainability, Yee Hop can stabilize its footing. A reasonable turnaround, meanwhile, calls for financial reinforcement, a sharper market presence, and a tech-savvy edge—steps that could lift it from volatility to steady growth. The Group’s recent profit and stock gains hint at resilience, offering ammunitions for surviving Hong Kong’s uncertain 2025 landscape. |