Neo-Concept International Group Holdings Limited
- Open
- 11.87
- Day high
- 11.94
- Day low
- 11.74
- Prev close
- 12.14
- Volume
- 18K
- Mkt cap
- $219M
- P/E (TTM)
- 59.1
- EPS (TTM)
- $0.20
- P/B
- 30.3
- P/S
- 5.2
- Yield
- —
- Per share
- —
Neo-Concept International Group Holdings Limited (NCI) is a Consumer Cyclical company listed on NASDAQ. The stock is down 29% over the past year.
Neo-Concept International Group Holdings Limited (NCI) financials & analyst ratings
Fundamentals (TTM)
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
NCI insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Sep 17, 2019 | Yingling Jeffrey W.director | Grant | 10 | — |
| Sep 17, 2019 | Walsh Kathleen Edirector | Grant | 10 | — |
| Sep 17, 2019 | Seseri Rudinadirector | Grant | 10 | — |
| Sep 17, 2019 | JAMES STEPHAN Adirector | Grant | 10 | — |
| Sep 17, 2019 | HOWARD JULIEdirector, officer: Chairman & CEO | Grant | 69 | — |
| Jun 18, 2019 | HOWARD JULIEdirector, officer: Chairman & CEO | Grant | 85 | — |
| Jun 18, 2019 | JAMES STEPHAN Adirector | Grant | 96,859 | — |
| Jun 18, 2019 | Walsh Kathleen Edirector | Grant | 12 | — |
| Jun 18, 2019 | Yingling Jeffrey W.director | Grant | 12 | — |
| Jun 18, 2019 | Seseri Rudinadirector | Grant | 12 | — |
| May 15, 2019 | JAMES STEPHAN Adirector | Grant | 5,440 | — |
| May 15, 2019 | Walsh Kathleen Edirector | Grant | 5,440 | — |
| May 15, 2019 | Seseri Rudinadirector | Grant | 5,440 | — |
| May 15, 2019 | Yingling Jeffrey W.director | Grant | 5,440 | — |
| Mar 19, 2019 | HOWARD JULIEdirector, officer: Chairman & CEO | Grant | 97,293 | — |
Source: NCI SEC Form 4 filings, latest Sep 17, 2019. For informational purposes only — not investment advice.
See the full NCI insider & 13F page →Neo-Concept International Group Holdings Limited company profile
Overview
Neo-Concept International Group Holdings Limited (NASDAQ:NCI) is a Hong Kong-based apparel manufacturing and supply chain management company that was incorporated in 2021, though its operations trace back to earlier business activities. The company went public in 2012 and operates as a subsidiary of Neo-concept (BVI) Limited. Neo-Concept provides comprehensive apparel solutions primarily serving brand owners, sourcing agents, and online fashion retailers across North America, the United Kingdom, and Europe. The company has positioned itself as a one-stop solution provider in the competitive global apparel manufacturing industry.
Business
Neo-Concept International operates in the apparel manufacturing and supply chain management industry, which involves the complex process of transforming raw materials into finished clothing products for global brands and retailers. The company provides what it calls a "one-stop apparel solution," meaning it handles multiple stages of the clothing production process under one roof. The company's core services span the entire apparel supply chain and include market trend analysis (researching fashion trends and consumer preferences), product design and development (creating clothing designs and prototypes), raw material sourcing (procuring fabrics and other components), production and quality control (manufacturing garments and ensuring they meet specifications), and logistics management (coordinating shipping and delivery to end customers). Neo-Concept also operates its own retail brand called "les 100 ciels," under which it sells knitwear and other apparel products. This represents a smaller portion of the business compared to its primary role as a contract manufacturer and supply chain service provider for other brands. The company specializes particularly in knitwear products, which include sweaters, cardigans, and other knitted garments that require specialized manufacturing expertise and equipment.
Revenue model
Neo-Concept generates revenue through two primary business models. The majority of its income comes from contract manufacturing and supply chain services, where the company charges fees for designing, producing, and delivering apparel products for brand owners, sourcing agents, and online fashion retailers. Customers pay for the comprehensive service package, which includes everything from initial design consultation to final product delivery. The company also generates revenue through direct product sales under its proprietary "les 100 ciels" brand, though this represents a smaller portion of total revenue. In this model, Neo-Concept acts as both manufacturer and retailer, capturing higher margins but also taking on inventory and market risks. Several factors significantly impact the company's profitability margins. Raw material costs, particularly cotton and synthetic fiber prices, directly affect production expenses and can fluctuate based on global commodity markets and supply chain disruptions. Labor costs in manufacturing regions influence the company's competitive positioning, as apparel manufacturing is labor-intensive. Currency exchange rates play a crucial role since the company operates internationally, with revenues often in different currencies than costs. Seasonal demand patterns in the fashion industry create revenue volatility, with retailers typically placing larger orders before key selling seasons. Additionally, competition from low-cost manufacturing regions, particularly in Southeast Asia, puts pressure on pricing and margins, while trade policies and tariffs between major markets can significantly impact the cost structure and competitiveness of the company's offerings.
Competitive moat
Neo-Concept's competitive moat appears to be relatively narrow in the highly competitive apparel manufacturing industry. The company's primary defensive position comes from its integrated supply chain capabilities and established relationships with North American and European clients. By offering comprehensive services from design to delivery, Neo-Concept provides convenience and reduces complexity for brand owners who might otherwise need to coordinate with multiple suppliers. However, this moat faces significant challenges. The apparel manufacturing industry has low barriers to entry and is characterized by intense price competition from manufacturers in lower-cost regions such as Vietnam, Bangladesh, and Cambodia. Many competitors can replicate Neo-Concept's service offerings, and switching costs for customers are generally low since apparel manufacturing processes are relatively standardized. The company's "les 100 ciels" brand could potentially provide some differentiation, but it represents a small portion of the business and faces competition from countless other fashion brands. Geographic proximity to key markets offers some advantage in terms of shorter lead times and easier communication, but this benefit is often outweighed by significantly lower labor costs in other manufacturing regions. The most significant competitive threats come from large-scale manufacturers in Southeast Asia that can offer similar services at lower costs, as well as technological disruption through automation and digital supply chain platforms that could reduce the value of Neo-Concept's traditional intermediary role. The company's relatively small size also limits its ability to achieve the economies of scale that larger competitors enjoy.
Risks & safety
Neo-Concept's margin of safety appears extremely limited based on its financial position, presenting significant solvency and investment risks. • Cash burn and liquidity crisis: The company generated negative operating cash flows of $6.3 million in 2023 and $5.5 million in 2022, while holding only $748,794 in cash and short-term investments as of 2023 year-end. • Debt and solvency concerns: Total liabilities of $11.9 million exceed total assets of $11.6 million, creating negative equity of approximately $305,545. Current liabilities of $8.9 million significantly exceed current assets of $8.2 million, resulting in a current ratio of 0.91. • Valuation metrics: With an EV/EBITDA ratio of 102.8x and negative return on equity of -1.85%, traditional valuation metrics suggest the stock is either extremely overvalued or the business model is fundamentally challenged. • Other considerations: Revenue declined dramatically from $44.5 million in 2022 to $22.3 million in 2023, indicating deteriorating business performance. The company's small market capitalization of approximately $7.9 million suggests limited access to capital markets for potential refinancing.
Recent development
Due to the absence of recent earnings call transcripts, specific details about Neo-Concept's strategic initiatives and recent developments are limited. However, based on the available financial data, the company appears to be experiencing significant operational challenges rather than pursuing growth initiatives. The most notable development is the dramatic revenue decline of approximately 50% from 2022 to 2023, falling from $44.5 million to $22.3 million. This suggests the company may be losing major clients or facing severe market pressures. Despite this revenue contraction, the company maintained its comprehensive supply chain service model and continued operating its "les 100 ciels" retail brand. The company's focus appears to be on survival and operational efficiency rather than expansion, given the negative cash flows and deteriorating financial position. Without access to management commentary through earnings calls, it's unclear what specific strategic measures the company is taking to address its financial challenges or whether it's considering strategic alternatives such as asset sales, restructuring, or seeking additional capital.
NCI company profile · for informational purposes only — not investment advice.
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