With the business potentially at an important milestone, we thought we'd take a closer look at Nayuki Holdings Limited's (HKG:2150) future prospects. Nayuki Holdings Limited, an investment holding company, operates a chain of teahouses in China. The HK$6.7b market-cap company's loss lessened since it announced a CN¥469m loss in the full financial year, compared to the latest trailing-twelve-month loss of CN¥149m, as it approaches breakeven. Many investors are wondering about the rate at which Nayuki Holdings will turn a profit, with the big question being "when will the company breakeven?" We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for Nayuki Holdings

Nayuki Holdings is bordering on breakeven, according to the 16 Hong Kong Hospitality analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of CN¥175m in 2023. The company is therefore projected to breakeven around 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 55% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won't go into details of Nayuki Holdings' upcoming projects, but, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we'd like to point out is that Nayuki Holdings has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are key fundamentals of Nayuki Holdings which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Nayuki Holdings, take a look at Nayuki Holdings' company page on Simply Wall St. We've also compiled a list of pertinent aspects you should look at:

1. Valuation: What is Nayuki Holdings worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Nayuki Holdings is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Nayuki Holdings's board and the CEO's background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.