We feel now is a pretty good time to analyse Arrail Group Limited's (HKG:6639) business as it appears the company may be on the cusp of a considerable accomplishment. Arrail Group Limited operates dental hospitals and clinics in China. The HK$3.4b market-cap company posted a loss in its most recent financial year of CN¥220m and a latest trailing-twelve-month loss of CN¥126m shrinking the gap between loss and breakeven. The most pressing concern for investors is Arrail Group's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Arrail Group is bordering on breakeven, according to the 3 Hong Kong Healthcare analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of CN¥21m in 2024. So, the company is predicted to breakeven approximately 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 110%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Arrail Group's growth isn't the focus of this broad overview, but, take into account 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 The company has managed its capital prudently, with debt making up 16% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Arrail Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Arrail Group's company page on Simply Wall St. We've also put together a list of key aspects you should look at:

1. Valuation: What is Arrail Group 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 Arrail Group 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 Arrail Group'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.