China Sunsine Chemicals

Still undervalued. The Best is Yet to Be!

Bestworld wrote:

Still undervalued. The Best is Yet to Be!

Solid Q1 result. The Best is Yet to Come!

Unwarranted sell-down last week, due to Chinese news on environmental inspection at Sunsine's plant.

infopub.sgx.com/Apps?A=COW_CorpAnnouncem...419#.NextInsight.net


The above clarification demonstrates that Sunsine has by and large lifted its environment protection to a good level. And that environmental issues are part of the barrier to entry (or success) in this business. Any company that can surmount this will have a strong market share.

Analyst has a new report today and a target pr of $1.245.

www.nracapital.com/research/sgxresearchreport/17067cgdjl

This year Sunsine marks the 10th anniversary of its listing on SGX. It's not just a milestone but a testament to its "authenticity" as a Chinese listco, unlike the S-chips that bombed out after a few years, usually within 5 years. Will Sunsine pay out a special dividend? Hope is rising ...

China Sunsine has moved considerably since July but I think the key questions many investors will need to ask themselves is if there is going to be sufficient upside in this year? Playing the long game is well and good but factoring opportunity costs is important as well due to limited resources.

As it stands, capacity expansion will not happen until 2018 and the possibility for more earnings upside is constrained evident from sliding ASP from year to year.

I urge investors to really do a proper due diligence before plunging into this at current prices. PE multiples are a signs of the times and are equivalent to the crest and trough of tides. Undervaluation is not justified through multiples alone.