Sunsine is in a good position to do share buyback as well as pay decent dividends.
If it earns RMB 516m this year as forecast by PhillipCapital, EPS will be 21c per share, giving rise to a PER below 6.
China Sunsine has RMB 1,169m cash (equivalent to 48c per share) and if this sum is excluded from the share price, ex-cash PER will be below 4.
Share buyback will enhance shareholders' value more so when it is done when NAV is close to $1.
What is interesting is that the upcoming capacity expansion (RMB 1,500m for PPE and RMB 1,000m for working capital) can be fully funded from future operating cash flows, leaving the RMB 1,169m cash intact for share buyback and dividend payment.
