This is led by the nation’s supply-side reform initiatives and stringent environmental policies, which are phasing out smaller producers in favour of leading producers such as Sunsine. The move has in turn seen a surge in average domestic market prices over the recent two years due to supply shortage.
SINGAPORE (Jan 29): Phillip Capital is initiating coverage on China Sunsine, the largest producer of rubber accelerators in the world, with a “buy” call and target price of $1.60 or 10 times FY18 earnings.
In a Monday report, analyst Chen Guangzhi says he expects the group’s current attractive product spread to sustain growth for the next couple of years as supply continues its consolidation in China.
