How does OneConnect's performance this half compare to its main competitors in the Chinese fintech space?

Fundamental comparison

One‑Connect’s H1‑2025 results (though still unaudited) show revenue of ¥4.2 bn, up 12 % YoY, and an adjusted EBITDA margin of ≈9 %. That growth is solid but lags the sector’s front‑runners. Ant Group’s fintech division posted ≈20 % top‑line growth and a 15‑% EBITDA margin for the same period, while Lufax’s fintech‑service arm grew ≈15 % with margins around 11 %. Even Tencent’s WeBank/WeFinance platform, which isn’t a pure‑play TaaS provider but is a benchmark for scale, posted >25 % revenue growth and margins above 13 % in H1‑2025. The gap is largely driven by One‑Connect’s slower client acquisition in the “digital banking‑as‑a‑service” segment and a higher proportion of legacy legacy banking‑IT contracts that drag margin. Cash‑flow is positive but modest (free‑cash‑flow conversion ≈ 70 % of net profit), whereas rivals like Ant and Lufax have free‑cash‑flow conversion rates above 90 %, giving them more flexibility for R&D and M&A.

Technical and trading implications

From a market‑technical view, OCFT is trading ≈2 % below its 50‑day SMA with a relative strength index (RSI) around 45, indicating limited upside momentum but also room for a bounce if the results beat expectations. Volume has been trending up (average daily volume up 18 % YoY), suggesting growing investor interest despite the modest earnings. If One‑Connect delivers a revenue beat (+>5 % vs consensus) and margin improvement (≥10 % EBITDA), the stock could rally 4‑6 % to retest the 60‑day high (≈$24.8). A miss on either revenue or margin would likely trigger a 2‑3 % sell‑off, especially as peers’ earnings are already priced in.

Actionable view: Keep a tight watch on the earnings release (expected Aug 15). If the company beats both top‑line and margin targets, consider a short‑term long position with a stop‑loss at the 50‑day SMA (≈$22.5) and a target of $25–$26. If the guidance signals slower growth or margin pressure, scale back exposure and watch for a potential sell‑off toward support at the 200‑day MA (~$20.5), where a re‑entry could be justified only after a clear catalyst (e.g., new AI‑driven product launch or strategic partnership).