# Ningxia Baofeng Energy Group (600989.SHG)

Canonical: https://gigainvestors.com/s/600989.SHG

Analysis as of: 2026-10-16T07:34:34.111Z. Financial observations: FY2007–FY2025.

Listing currency: CNY. Reporting currency: CNY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: CNY 22.02 per share; close as of 2026-10-15.

Estimated value: low CNY 22.74 per share, central CNY 32.39 per share, high CNY 38.02 per share. Buy at or below the central value CNY 32.39 per share. Valuation as of 2026-10-16T07:34:34.111Z; scenarios are not confidence intervals.

Expected annual return: 13.1% at the stated quote. About 13.1% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; CN 10-year bond 1.7% + 4 points).

## Checklist

### understandable: pass

- 0 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 0

- Years with a net loss: 0

- Operating margin variation: 0.15×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.26×

- FY2017: 0.30×

- FY2018: 0.35×

- FY2019: 0.34×

- FY2020: 0.35×

- FY2021: 0.36×

- FY2022: 0.27×

- FY2023: 0.23×

- FY2024: 0.24×

- FY2025: 0.30×

### moat: fail

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 8.1pp below the typical margin (limit 4pp)

- ROIC, median of available years: 15.4%

- ROIC, second-lowest year: 9.6%

- Typical minus recent gross margin: 8.1 pp

- Typical gross margin (annual median): 41.2%

- Recent gross margin (lower of latest and 3-year median): 33.1%

- Years with nonpositive capital: 0

- Capital spending / revenue: 19.6%

- ROIC including acquisitions, ten-year median: 13.2%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 9.4%

- FY2017: 18.0%

- FY2018: 18.5%

- FY2019: 14.7%

- FY2020: 16.1%

- FY2021: 19.8%

- FY2022: 14.5%

- FY2023: 10.3%

- FY2024: 9.6%

- FY2025: 16.5%

### economics: fail

- owner earnings cash conversion below threshold

- Owner earnings / net income, 5-yr: 0.63×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CNY 23B

- Net income, five-year total: CNY 37B

- Return on incremental invested capital: 23.8%

- Working capital / revenue, annual change: -1.6 pp

- Working capital / revenue, change between three-year averages: -9.6 pp

- Working capital / revenue, final three-year average: 2.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.00×

- FY2022: 1.00×

- FY2023: -0.73×

- FY2024: 0.57×

- FY2025: 0.91×

### management: pass

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 18.0% vs 10.3%

- Per-share earnings: 0.26 to 0.87 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.9%

- Ordinary dilution, 5-year annual growth: -0.3%

- Diluted shares, 10-year annual growth: 0.9%

- Diluted shares, 5-year annual growth: -0.3%

- Per-share value growth: 16.2%

- Per-share value change: CNY 0.61

- Per-share value, starting three-year median: CNY 0.26

- Per-share value, ending three-year median: CNY 0.87

- Average buyback yield: 0.2%

- Buyback history: 1 years

- Debt-funded buybacks: No

- Acquisition spending: CNY 4.1B

- Cumulative net income, 10 years: CNY 53B

- ROIC, first three-year median: 18.0%

- ROIC, last three-year median: 10.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: CNY 0.26

- FY2017: CNY 0.44

- FY2018: CNY 0.57

- FY2019: CNY 0.50

- FY2020: CNY 0.63

- FY2021: CNY 0.95

- FY2022: CNY 0.88

- FY2023: CNY 0.78

- FY2024: CNY 0.87

- FY2025: CNY 1.56

### accounting: pass

- latest-year receivables to sales index (DSRI) exceeds 1.465

- Sloan accruals: -6.1%

- Receivables to sales index (DSRI): 1.96×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.3%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.48×

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.12×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -0.2%

- FY2017: -0.4%

- FY2018: 1.6%

- FY2019: 0.7%

- FY2020: -1.5%

- FY2021: 1.3%

- FY2022: -0.6%

- FY2023: -4.2%

- FY2024: -2.9%

- FY2025: -6.1%

## Holders

## Price story

Down 28% since Apr 2026 · sales +45.1%

Story as of 2026-10-16T10:00:01.379Z; price observation 2026-10-15.

Price needs cash profits to grow 1.6% a year for ten years

### Sales · FY2024–2025

sales +45.1%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: CNY 8.0B 

- FY2017: CNY 12B 

- FY2018: CNY 13B 

- FY2019: CNY 14B 

- FY2020: CNY 16B 

- FY2021: CNY 23B 

- FY2022: CNY 28B 

- FY2023: CNY 29B 

- FY2024: CNY 33B 

- FY2025: CNY 48B 

### Gross margin · FY2025

gross margin 35.3%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 40.3% 

- FY2017: 43.2% 

- FY2018: 46.9% 

- FY2019: 43.9% 

- FY2020: 45.1% 

- FY2021: 42.1% 

- FY2022: 32.8% 

- FY2023: 30.4% 

- FY2024: 33.1% 

- FY2025: 35.3% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in chemicals; annual sales are CNY 47.9 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2025: revenue 47850751000; grossProfit 16890704000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 600989.SHG: Ningxia Baofeng Energy Group Co., Ltd., together with its subsidiaries, produces and sells chemical products in China and internationally. It operates through Olefin Products, Coking Products, Fine Chemical Products, and Headquarters and Other Product segments. The company offers polypropylene, coking benzene, methyl tert-butyl ether, polyethylene, refined methanol, industrial sulfur, fertilizer-grade ammonium sulfate, mixed naphthalene, and coal tar pitch. It is also involved in the production and operation of olefin products; coal mining, washing, and processing; coking production and other related processes; production and operation of crude benzene; deep processing of C4; and investment and financing activities. In addition, the company engages in the manufacture and sale of synthetic materials; business, conference, exhibition, and office services; modern logistics, parking, accommodation, and domestic trade and retail; production and sale of ready-mixed concrete and precast cement components; construction projects; and private equity funds, equity investment, investment and asset management, and venture capital activities. The company was formerly known as Ningxia Baofeng Energy Co., Ltd. and changed its name to Ningxia Baofeng Energy Group Co., Ltd. in January 2014. Ningxia Baofeng Energy Group Co., Ltd., was founded in 2005 and is headquartered in Yinchuan, China.

### Why customers stay

Margins ranged from 30.4% to 35.3% during 2023–25; it earns 15.4% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2023: grossProfit / revenue = 30.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2024: grossProfit / revenue = 33.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2025: grossProfit / revenue = 35.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); 10-year return on capital observations [[2016,0.09448597390360272],[2017,0.17976777362916824],[2018,0.18527128623409836],[2019,0.14735484848022465],[2020,0.16149586216008563],[2021,0.19773811100989894],[2022,0.14462429067230972],[2023,0.10266976296849552],[2024,0.09590322124630918],[2025,0.1646242858875494]]; median 0.15442535532015514. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 32.2% of cash earnings on expansion; earns 23.8% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2016: growth capex 28185021.690000057; upkeep 670134981; owner earnings 1718475045. Growth capex / owner earnings = 0.016401181833862508.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2017: growth capex 58250044.399999976; upkeep 735994320; owner earnings 2923435675. Growth capex / owner earnings = 0.01992520133010964.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2018: growth capex 835456661.51; upkeep 764169608; owner earnings 3695515639. Growth capex / owner earnings = 0.2260730959147214.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2019: growth capex 1043250644.3769016; upkeep 3497290941.283098; owner earnings 1122254556.7169018. Growth capex / owner earnings = 0.9296025025096605.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2020: growth capex 1475467228.4899998; upkeep 1098477061; owner earnings 4622768048. Growth capex / owner earnings = 0.3191739696150984.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2021: growth capex 4044258405.7200003; upkeep 1312904215; owner earnings 7064099693.912. Growth capex / owner earnings = 0.5725086820625469.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2022: growth capex 8578632954.33; upkeep 1398538954; owner earnings 6301451079.33. Growth capex / owner earnings = 1.3613742051365922.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2024: growth capex 7176467057.5504; upkeep 4352612942.4496; owner earnings 3639768290.1264. Growth capex / owner earnings = 1.9716823944584614.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); FY2025: growth capex 3339003000; upkeep 3304086000; owner earnings 10378570658.072. Growth capex / owner earnings = 0.32172089105575136.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); Incremental return on capital 0.23770606588979823, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); Dividend observations: [[2016,530724424.59],[2017,2553491852.1],[2018,1921746260.83],[2019,2053340800],[2020,2052981176],[2021,2049405598],[2022,3071622479],[2023,1544561989],[2024,3206270000],[2025,6103671000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 72.1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 600989.SHG SharesStats.PercentInsiders = 72.141 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 1.6% yearly over ten years; actual growth was 20.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:34:34.111Z); Ten-year compound average after fade. Initial solved rate 0.010069803360387632. Price 22.02; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.2294888606060606 → FY2025 1.4308908625838355. Closing-price date 2026-10-15.

## Monthly share-price history (CNY per share)

- 2019-05: CNY 14.02 per share

- 2019-06: CNY 11.81 per share

- 2019-07: CNY 11.17 per share

- 2019-08: CNY 10.39 per share

- 2019-09: CNY 9.89 per share

- 2019-10: CNY 9.42 per share

- 2019-11: CNY 9.42 per share

- 2019-12: CNY 9.51 per share

- 2020-01: CNY 9.08 per share

- 2020-02: CNY 9.51 per share

- 2020-03: CNY 8.42 per share

- 2020-04: CNY 8.44 per share

- 2020-05: CNY 8.90 per share

- 2020-06: CNY 8.42 per share

- 2020-07: CNY 10.32 per share

- 2020-08: CNY 12.50 per share

- 2020-09: CNY 10.20 per share

- 2020-10: CNY 10.17 per share

- 2020-11: CNY 12.59 per share

- 2020-12: CNY 11.70 per share

- 2021-01: CNY 16.15 per share

- 2021-02: CNY 17.48 per share

- 2021-03: CNY 15.66 per share

- 2021-04: CNY 16.21 per share

- 2021-05: CNY 14.21 per share

- 2021-06: CNY 13.68 per share

- 2021-07: CNY 15.69 per share

- 2021-08: CNY 16.06 per share

- 2021-09: CNY 16.08 per share

- 2021-10: CNY 14.60 per share

- 2021-11: CNY 16.24 per share

- 2021-12: CNY 17.36 per share

- 2022-01: CNY 15.91 per share

- 2022-02: CNY 17.50 per share

- 2022-03: CNY 14.86 per share

- 2022-04: CNY 14.10 per share

- 2022-05: CNY 15.56 per share

- 2022-06: CNY 14.65 per share

- 2022-07: CNY 13.46 per share

- 2022-08: CNY 13.58 per share

- 2022-09: CNY 13.32 per share

- 2022-10: CNY 11.47 per share

- 2022-11: CNY 13.22 per share

- 2022-12: CNY 12.07 per share

- 2023-01: CNY 13.38 per share

- 2023-02: CNY 15.80 per share

- 2023-03: CNY 14.75 per share

- 2023-04: CNY 13.18 per share

- 2023-05: CNY 12.15 per share

- 2023-06: CNY 12.61 per share

- 2023-07: CNY 14.16 per share

- 2023-08: CNY 13.71 per share

- 2023-09: CNY 14.30 per share

- 2023-10: CNY 14.42 per share

- 2023-11: CNY 14.67 per share

- 2023-12: CNY 14.77 per share

- 2024-01: CNY 13.34 per share

- 2024-02: CNY 15.27 per share

- 2024-03: CNY 16.35 per share

- 2024-04: CNY 16.59 per share

- 2024-05: CNY 16.42 per share

- 2024-06: CNY 17.33 per share

- 2024-07: CNY 15.03 per share

- 2024-08: CNY 15.23 per share

- 2024-09: CNY 17.35 per share

- 2024-10: CNY 15.91 per share

- 2024-11: CNY 16.15 per share

- 2024-12: CNY 16.84 per share

- 2025-01: CNY 17.53 per share

- 2025-02: CNY 16.55 per share

- 2025-03: CNY 14.53 per share

- 2025-04: CNY 16.03 per share

- 2025-05: CNY 16.00 per share

- 2025-06: CNY 16.14 per share

- 2025-07: CNY 15.54 per share

- 2025-08: CNY 17.35 per share

- 2025-09: CNY 17.80 per share

- 2025-10: CNY 18.44 per share

- 2025-11: CNY 18.00 per share

- 2025-12: CNY 19.63 per share

- 2026-01: CNY 23.76 per share

- 2026-02: CNY 23.93 per share

- 2026-03: CNY 29.06 per share

- 2026-04: CNY 30.70 per share

- 2026-05: CNY 24.00 per share

- 2026-06: CNY 20.33 per share

- 2026-07: CNY 23.29 per share

- 2026-08: CNY 24.72 per share

- 2026-09: CNY 22.46 per share

- 2026-10: CNY 22.36 per share

## Annual estimated value (CNY per share)

- FY2016: low CNY 1.43 per share, central CNY 1.58 per share, high CNY 1.79 per share

- FY2017: low CNY 5.67 per share, central CNY 8.00 per share, high CNY 9.35 per share

- FY2018: low CNY 6.02 per share, central CNY 8.53 per share, high CNY 9.98 per share

- FY2019: low CNY 5.42 per share, central CNY 7.66 per share, high CNY 8.96 per share

- FY2020: low CNY 7.38 per share, central CNY 10.39 per share, high CNY 12.13 per share

- FY2021: low CNY 12.21 per share, central CNY 17.38 per share, high CNY 20.39 per share

- FY2022: low CNY 15.47 per share, central CNY 22.01 per share, high CNY 25.81 per share

- FY2023: low CNY 12.24 per share, central CNY 17.45 per share, high CNY 20.48 per share

- FY2024: low CNY 13.86 per share, central CNY 19.69 per share, high CNY 23.08 per share

- FY2025: low CNY 19.51 per share, central CNY 27.84 per share, high CNY 32.70 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.