In addition, Chen is positive on the company’s management vision, which led to a “well-timed ramp-up of capacity”. The ramp-up in capacity helped provide a buffer against the cyclical downturn, he says in a May 20 report.
KGI Research analyst Chen Guangzhi has maintained “outperform” on China Sunsine with a higher target price of 68 cents from 53 cents previously, as the company could see a turnaround in profitability in the FY2021, thanks to the upcycle in commodity prices and capacity ramp-up.
That said, Chen says average selling prices (ASPs) for rubber chemicals could fall in the 2HFY2021, although China Sunsine’s higher productivity in insoluble Sulphur and anti-oxidant is expect to offset the potentially weaker price later in the year.
