MeritValue

Lianhe Sowell International Group Ltd

LHSWdata completeness 100%4 fiscal years on file

Data notes: no data for concept 'investmentsAtFairValue'; no data for concept 'netInvestmentIncome'; no data for concept 'gainsOnRealEstateSales'; no data for concept 'realEstateImpairment'; no data for concept 'dividendsPaid'; no data for concept 'interestExpense'

The thesis, from the filings

Lianhe Sowell International Group Ltd earns about 22% on invested capital, and has bought back 93% of its shares over 4 years. The applicable estimate puts fair value near $6.9 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2023FY 2024FY 2025FY 2026
Revenue$13.1M1$36.6M2$36.5M2$43.3M2
Net income$1.61M3$2.82M4$3.12M4−$5.7M4
Operating cash flow−$1.47M5−$2.08M6−$1.47M6−$8.97M6
Capital expenditure$3,0567$66,7458$4,9178$83,0068
Free cash flow (derived)−$1.47M5−$2.14M6−$1.48M6−$9.05M6
Total debt—$1.66M9$2.04M10$6.35M10
Cash & equivalents$752,00711$206,18712$108,74513$1.89M13
Diluted shares50.0M3.1M3.1M3.3M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$42.37
your share of equity
Profit it earned you last year
−$17.4
Free cash flow it threw off
−$27.64
Debt you’d be carrying
$19.39

10 shares is a claim on $42.37 of net worth that earned you −$17.4 and generated −$27.64 of cash last year, against $19.39 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
22% avg · 4y
FY23 65%FY24 30%FY25 23%FY26 -30%

It earned an average 22% on invested capital over 4 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
−93% shares · 4y

Share count is down 93% over 4 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 282% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.5.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
$6.9
assumptions (8)
  • riskFreeRate4.8%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$2.21M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 20-F · period ending 2023-03-31 · accession 0001213900-25-077169 (Revenues)
  2. 20-F · period ending 2024-03-31 · accession 0001213900-26-089090 (Revenues)
  3. 20-F · period ending 2023-03-31 · accession 0001213900-25-077169 (NetIncomeLoss)
  4. 20-F · period ending 2024-03-31 · accession 0001213900-26-089090 (NetIncomeLoss)
  5. 20-F · period ending 2023-03-31 · accession 0001213900-25-077169 (NetCashProvidedByUsedInOperatingActivities)
  6. 20-F · period ending 2024-03-31 · accession 0001213900-26-089090 (NetCashProvidedByUsedInOperatingActivities)
  7. 20-F · period ending 2023-03-31 · accession 0001213900-25-077169 (PaymentsToAcquirePropertyPlantAndEquipment)
  8. 20-F · period ending 2024-03-31 · accession 0001213900-26-089090 (PaymentsToAcquirePropertyPlantAndEquipment)
  9. 20-F · period ending 2024-03-31 · accession 0001213900-25-077169 (ShortTermBorrowings)
  10. 20-F · period ending 2025-03-31 · accession 0001213900-26-089090 (LongTermDebtCurrent)
  11. 20-F · period ending 2023-03-31 · accession 0001213900-26-089090 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)
  12. 20-F · period ending 2024-03-31 · accession 0001213900-25-077169 (CashAndCashEquivalentsAtCarryingValue)
  13. 20-F · period ending 2025-03-31 · accession 0001213900-26-089090 (CashAndCashEquivalentsAtCarryingValue)