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The Hong Kong and China Gas Company Limited

0003.HK
49
Regulated Gas · Utilities
Price
HK$7.13
+0.06 (+0.85%)
Market Cap
HK$133.14B
Exchange
Hong Kong Stock Exchange
Winston Score
49
Winston is serious
Mixed quality — meaningful strengths and weaknesses.
Data as of Oct 10, 2026 · filings through Jun 30, 2026

§How the score breaks down

Quality
Mixed
9/30
Growth
Good
12/20
Cash Flow
Strong
8/10
Stability
Mixed
3/10
Valuation
Mixed
4/10
Ownership
Good
10/15
Dividends
Good
3/5

49 of 100 counted points = Winston Score 49.

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§Winston Score History

The full picture

Hong Kong and China Gas Co Ltd, known as Towngas, is a utility company that supplies piped natural gas to homes and businesses across Hong Kong and mainland China. Its core products include gas supply, gas appliances, and related installation and maintenance services. Towngas has been operating in Hong Kong since 1862, making it one of the oldest utility companies in the region.

The company earns money through gas distribution fees, appliance sales, and service contracts. It operates a vast pipeline network across Hong Kong and has expanded into dozens of cities in mainland China through joint ventures and partnerships. Its moat comes from the high cost of building pipeline infrastructure, which makes it very difficult for competitors to enter its markets. The main risk the company faces is the long-term shift toward electricity and renewable energy, which could reduce demand for piped gas over time.

Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+7.3% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

+25.0% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

HK$0/ year

0.0% of revenue

Below sector average (1%)

Research and development spending

Insider Activity

41.9%ownership

Insiders own a meaningful stake in the company

Cash Position

Cash flow positive

HK$66.3B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

The Hong Kong and China Gas Company Limited is growing revenue at 7% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

0.0% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 18.66B (2021) → 18.66B (2025)

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale
Gross Margin
23.9%
Thin — 23.9% gross margin
Profit after running costs
Operating Margin
15.0%
Healthy — 15.0% operating margin
Return on the money invested
ROCE
2.6%
Weak — 2.6% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales growth
Sales YoY
+1.5%
Nearly flat sales (+1.5% YoY)
Profit growth
EPS YoY
+16.7%
Earnings growing fast (+16.7% YoY)

Healthy double-digit earnings growth — what compounders look like.

How steady the profit is
EPS Consistency
6/8 quarters
Earnings grew in most of the last 8 quarters

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Cash Flow

Profit that turns into cash
Cash Conversion
165%
Turns 165% of profit into real cash
Spare cash per sale
FCF Margin
9.5%
Modest free cash flow (9.5%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

What it owes vs what it owns
Debt / Equity
1.04
Elevated debt (1.04)
Covers its interest
Interest Cover
1.62x
Dangerous — barely covers interest (1.6x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

Price vs profit
P/E Ratio (TTM)
20.4x
Growth-priced — P/E 20.4

P/E above the market average. People are paying up for expected growth.

Cheaper or dearer next year
P/E vs Forward
+0.1
GROWING
Earnings roughly flat

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Dividends

Dividend
Dividend Yield
6.73%
Healthy income — 6.73% yield

Yield above 6% — often a flag the market is pricing in a cut.

Dividend record
Dividend Growth
+0.0%
Dividend flat

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