Hongfa Technology Co (SHSE:600885) Operating Income: ¥3,200 Mil (TTM As of Jun. 2026)

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SHSE:600885 Hongfa Technology Co Ltd SHSE:600885
90 GF Score
Price ¥34.46
GF Value ¥32.98
Valuation Fairly Valued
! 4 Warning Signs
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What is Hongfa Technology Co Operating Income?

Hongfa Technology Co SHSE:600885 +0.47% 90 Operating Income is ¥3,200 Mil as of Jun. 2026. GuruFocus rates SHSE:600885 with a GF Score™ of 90/100 and a GF Value™ of ¥32.98 (Fairly Valued). The stock has 4 warning signs investors should review.

Hongfa Technology Co's Operating Income for the three months ended in Jun. 2026 was ¥1,093 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2026 was ¥3,200 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Hongfa Technology Co's Operating Income for the three months ended in Jun. 2026 was ¥1,093 Mil. Hongfa Technology Co's Revenue for the three months ended in Jun. 2026 was ¥5,914 Mil. Therefore, Hongfa Technology Co's Operating Margin % for the quarter that ended in Jun. 2026 was 18.49%.

Good Sign:

Hongfa Technology Co Ltd operating margin is expanding. Margin expansion is usually a good sign.

Hongfa Technology Co's 5-Year average Growth Rate for Operating Margin % was 0.10% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Hongfa Technology Co's annualized ROC % for the quarter that ended in Jun. 2026 was 24.48%. Hongfa Technology Co's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2026 was 34.76%.


Hongfa Technology Co  (SHSE:600885) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Hongfa Technology Co's annualized ROC % for the quarter that ended in Jun. 2026 is calculated as:

ROC % (Q: Jun. 2026 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2026 ) + Invested Capital (Q: Jun. 2026 ))/ count )
=4373.68 * ( 1 - 10.53% )/( (15835.03 + 16137.785)/ 2 )
=3913.131496/15986.4075
=24.48 %

where

Invested Capital(Q: Mar. 2026 )
=Total Assets - Accounts Payable & Accrued Expense - Excess Cash
=Total Assets - Accounts Payable & Accrued Expense - ( Cash, Cash Equivalents, Marketable Securities - max(0, Total Current Liabilities - Total Current Assets+Cash, Cash Equivalents, Marketable Securities))
=23572.775 - 4994.715 - ( 2743.03 - max(0, 5794.289 - 14888.056+2743.03))
=15835.03

Invested Capital(Q: Jun. 2026 )
=Total Assets - Accounts Payable & Accrued Expense - Excess Cash
=Total Assets - Accounts Payable & Accrued Expense - ( Cash, Cash Equivalents, Marketable Securities - max(0, Total Current Liabilities - Total Current Assets+Cash, Cash Equivalents, Marketable Securities))
=25679.865 - 6586.518 - ( 2955.562 - max(0, 7581.463 - 16671.863+2955.562))
=16137.785

Note: The Operating Income data used here is four times the quarterly (Jun. 2026) data.

2. Joel Greenblatt's definition of Return on Capital:

Hongfa Technology Co's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2026 is calculated as:

ROC (Joel Greenblatt) %(Q: Jun. 2026 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Mar. 2026  Q: Jun. 2026
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=3990.6/( ( (6439.946 + max(5022.139, 0)) + (6582.997 + max(4914.169, 0)) )/ 2 )
=3990.6/( ( 11462.085 + 11497.166 )/ 2 )
=3990.6/11479.6255
=34.76 %

where Working Capital is:

Working Capital(Q: Mar. 2026 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(5154.661 + 4341.607 + 589.532) - (4994.715 + 0 + 68.946)
=5022.139

Working Capital(Q: Jun. 2026 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(6224.445 + 4758.76 + 594.678) - (6586.518 + 0 + 77.196)
=4914.169

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jun. 2026) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Hongfa Technology Co's Operating Margin % for the quarter that ended in Jun. 2026 is calculated as:

Operating Margin %=Operating Income (Q: Jun. 2026 )/Revenue (Q: Jun. 2026 )
=1093.42/5914.354
=18.49 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.


Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.


Hongfa Technology Co Operating Income Related Terms


Hongfa Technology Co Operating Income Historical Data

* Premium members only.

The historical data trend for Hongfa Technology Co's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Hongfa Technology Co Operating Income Chart

Hongfa Technology Co Annual Data
Trend Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23 Dec24 Dec25
Operating Income
Get a 7-Day Free Trial Premium Member Only Premium Member Only 1,684.09 2,006.04 2,488.61 2,505.04 2,806.76

Hongfa Technology Co Quarterly Data
Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24 Dec24 Mar25 Jun25 Sep25 Dec25 Mar26 Jun26
Operating Income Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 862.03 803.56 473.78 829.06 1,093.42
SHSE:600885
90GF Score
Hongfa Technology Co Ltd SHSE:600885
Operating Income is just one metric. See GF Score™, valuation, warning signs, and more.
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Hongfa Technology Co Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Jun. 2026 adds up the quarterly data reported by the company within the most recent 12 months, which was ¥3,200 Mil.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Frequently Asked Questions Learn more about Operating Income →
What does a Operating Income of ¥3,200 Mil mean?
Hongfa Technology Co (SHSE:600885) has a Operating Income of ¥3,200 Mil as of Jun. 2026. Operating Income equals sales less all operating expenses. It is linked to EBIT. View historical data on Hongfa Technology Co and its competitors.
Is Hongfa Technology Co's Operating Income too high?
Hongfa Technology Co's current Operating Income is ¥3,200 Mil. Overall, Hongfa Technology Co has a GF Score™ of 90/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Hongfa Technology Co's Operating Income compare to VRT and BE?
Hongfa Technology Co's Operating Income of ¥3,200 Mil can be compared against companies in the Industrial Products industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Operating Income for an Industrial Products company?
A good Operating Income depends on the Industrial Products industry context. However, Operating Income should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Operating Income mean?
A high Operating Income can signal that a stock is expensive relative to its fundamentals. Operating Income equals sales less all operating expenses. It is linked to EBIT. View historical data on Hongfa Technology Co and its competitors. Hongfa Technology Co's current Operating Income is ¥3,200 Mil. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Hongfa Technology Co stock overvalued right now?
Based on GuruFocus' analysis, Hongfa Technology Co (SHSE:600885) is currently considered Fairly Valued. The stock's GF Value™ is ¥32.98, compared to a current price of ¥34.46 — trading 4.5% above its estimated fair value. The current Operating Income is ¥3,200 Mil. Hongfa Technology Co's overall GF Score™ is 90/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Operating Income calculated?
Operating Income is calculated from a company's financial statements. For Hongfa Technology Co (SHSE:600885), the current Operating Income is ¥3,200 Mil as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Is Hongfa Technology Co (SHSE:600885) Overvalued in 2026?

Based on GuruFocus' analysis, Hongfa Technology Co stock appears to be overvalued. The current stock price of ¥34.46 is trading 4.5% above its estimated GF Value™ of ¥32.98. GuruFocus considers Hongfa Technology Co to be Fairly Valued.

Key valuation signals for SHSE:600885:

  • Operating Income: ¥3,200 Mil
  • GF Value™: ¥32.98 vs. price of ¥34.46 (4.5% above fair value)
  • GF Score™: 90/100 with 4 warning signs

No single metric tells the full story. See the SHSE:600885 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.


Hongfa Technology Co Business Description

Address No. 564, Donglin Road, Jimei North Industrial Zone, Fujian Province, Xiamen, CHN, 361021
Hongfa Technology Co Ltd is engaged in Research, manufacture and selling relays, low voltage electrical appliances, contactors, automation equipment and related electronic components and assemblies, electromechanical products, mechanical equipment.
90GF Score

Get the complete analysis for SHSE:600885

Operating Income is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

¥34.46
Price
¥32.98
GF Value