S.F. Holding’s April Surge: A Beacon of Resilience in China’s Logistics Landscape

Amid a shifting economic landscape, S.F. Holding Co., Ltd. (HK:6936) has delivered a compelling performance, reporting a 12.42% YoY revenue rise to RMB23.915 billion in April 2025. This milestone underscores its position as a sector leader in China’s logistics and real estate markets. But is this growth a fleeting spike or the start of a sustained recovery? Let’s dissect the data to uncover whether investors should seize this opportunity or exercise caution.

The Revenue Surge: More Than a Flash in the Pan

The April revenue jump was driven by two key segments:
1. Express Logistics: An 11.85% revenue increase, fueled by a 29.99% surge in parcel volume. This reflects S.F. Holding’s diversified product portfolio and its push into e-commerce, a sector critical to China’s post-pandemic demand rebound.
2. Supply Chain & International Business: A 14.20% revenue rise, bolstered by its expanded global network. The company’s strategic investments in Southeast Asia and Europe are paying dividends, aligning with Beijing’s “dual circulation” economic strategy.

The results are not isolated. In 2024, S.F. Holding already achieved RMB284.4 billion in annual revenue (up 10.1% YoY) and a 23.5% YoY net profit jump to RMB10.2 billion. This consistency suggests the company is capitalizing on structural tailwinds, including:
- Regulatory support: China’s push to modernize logistics infrastructure.
- Urbanization trends: Growth in real estate and last-mile delivery demand.
- Technological adoption: Deployment of AI-driven route optimization and unmanned warehouses.

Valuation: Undervalued Relative to Peers

Let’s compare S.F. Holding’s valuation multiples to its peers:

- S.F. Holding: 6.07x EV/EBITDA (vs. ZTO’s 9.11x and China Logistics Property’s 27.89x).
- P/E Ratio: 18x (vs. ZTO’s 13.46x and China Logistics’ median 14.3x).

These metrics reveal S.F. Holding is trading at a discount to peers, despite its stronger revenue and profit growth. Its low EV/EBITDA suggests the market underappreciates its operational efficiency and scale. Meanwhile, its P/E premium may reflect investor optimism about its long-term margin expansion.

Debt & Cash Flow: A Sustainable Foundation

While S.F. Holding carries RMB111.49 billion in debt, its RMB43.94 billion cash balance provides a buffer. Crucially, its EBITDA (RMB39.16 billion annually) comfortably covers interest expenses, with a debt-to-EBITDA ratio of 2.85x—well within healthy thresholds.

The company’s focus on cost discipline—evident in its “Unite for Shared Goals” strategy—ensures that growth isn’t debt-fueled. Instead, it’s driven by operational excellence, such as optimizing its 14,000+ service outlets and reducing delivery costs per parcel by 8% in 2024.

Risks to Consider

• Economic slowdown: A cooling property market could impact its real estate division.
• Regulatory shifts: New data privacy laws or cross-border trade barriers could disrupt international logistics.
• Competitive pressures: Rivalries with Cainiao (Alibaba’s logistics arm) and ZTO, which boasts a 22.1% market share in parcel volume, remain intense.

The Case for Immediate Investment

The data paints a clear picture: S.F. Holding is underpriced relative to its peers and poised to capitalize on secular trends in China’s logistics sector. Key catalysts include:
1. Valuation re-rating: Its low EV/EBITDA leaves room for multiples to expand as earnings visibility improves.
2. Global expansion: Its international network could unlock untapped markets in the ASEAN region and Europe.
3. Technological edge: Investments in AI and automation position it to reduce costs further and outpace competitors.

Conclusion: Buy Now—The Upside Outweighs the Risks

With a “Buy” rating, a HK$46.00 price target (vs. its current price of ~HK$43.15), and a 7.9% dividend yield, S.F. Holding offers a compelling risk-reward profile. While risks exist, the company’s robust cash flow, strategic execution, and undervalued status make it a must-own stock for investors betting on China’s logistics renaissance.

Act now—before the market catches up to this hidden gem.

Disclosures: This analysis is based on publicly available data. Investors should conduct their own due diligence.