Investors expect the company to outperform the industry, hence the high P/S ratio. However, the company's declining revenue and high P/S ratio pose a risk to shareholders and may deter potential investors.

Dongguan Huali IndustriesLtd's declining ROCE and increasing capital employed is worrisome, possibly indicating a loss of competitive advantage or market share. Despite past returns, current trends may not bode well for future investment.

Despite a strong share price surge, the company's high P/S ratio and declining revenue are concerning. Investors may be overlooking poor growth, hoping for a business turnaround. However, unless recent medium-term circumstances improve, shareholders may face a difficult period.