China Sunsine Chemicals

yeng
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9 years 5 months ago #21316 by yeng

Replied by yeng on topic China Sunsine Chemicals

The impact is quite massive:

"According to Sunsine’s AR2013, ceteris paribus, every 10% increase / decrease in the price of aniline would have decreased / increased net profit by RMB30.1m in FY13. As such, raw material costs do play a significant aspect in Sunsine’s profitability. As mentioned above, aniline prices have remained pretty stable since the start of the year."

Above is not I say one, but from Ernest Lim's article :

www.nextinsight.net/index.php/story-arch...ong-recovery-in-play

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Dongdaemun
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9 years 5 months ago #21321 by Dongdaemun

Replied by Dongdaemun on topic China Sunsine Chemicals

to answer your question, not so straight forward. as the ASP can be lowered on nego with customer w/o loss of GP margin.

Portuser at valuebuddies.com excerpt:

Aniline is an important raw material for making rubber accelerators. However, it may not make up 50% of accelerator production cost, as suggested by CIMB. Its weightage is more likely to be 30% (see note below).

The following are rubber accelerator price and cost data (per tonne) in 3Q 14:

ASP…….……………..RMB 22,800
Cogs ….………………RMB 15,700 (69% of ASP)
Cost of aniline……RMB 4,700 (30% of RMB 15,700)
Gross profit……....RMB 7,100

The 17% aniline price fall will result in aniline input cost being reduced by RMB 800. If accelerator ASP is cut by the same amount, gross profit will remain intact.

Sunsine is set to report a good profit even with a deeper accelerator price cut because next year, another 12,000 tonnes of accelerators and more 6PPD will be produced, and the cost-saving steam/electricity plant will start operating.

It should be noted that it cost very little to install the production lines for the 12,000 tonnes of accelerators because the supporting infrastructure was put in place earlier. The 4,000- tonne MBTS line cost RMB 3.5m, and the 8,000-tonne DCBS line RMB 9m. The potential output from these two lines has an aggregate value of at least RMB 240m on the assumption that a tonne of these products sells for a low RMB 20,000 (against RMB 22,800 ASP in 3Q 14).

This is one of Sunsine’s competitive advantages – lower unit production cost with capacity expansion.

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Dongdaemun
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9 years 4 months ago #21330 by Dongdaemun

Replied by Dongdaemun on topic China Sunsine Chemicals

The share price has reawakened! 44-4.5 cents with volume exceeding 1,000,000 shares. My grandfather said, the profit-takers have left and a new wave of investors are in the game. Target: 50 cents again.

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potatolover
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9 years 4 months ago - 9 years 4 months ago #21332 by potatolover

Replied by potatolover on topic China Sunsine Chemicals

My grandma said the next support level at 40 cents is coming.

Last edit: 9 years 4 months ago by potatolover.

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Bestworld
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9 years 4 months ago #21335 by Bestworld

Replied by Bestworld on topic China Sunsine Chemicals

Need more volume to support the up trend...

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yeng
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9 years 4 months ago - 9 years 4 months ago #21340 by yeng

Replied by yeng on topic China Sunsine Chemicals

potatolover wrote: My grandma said the next support level at 40 cents is coming.

Hope your grandma is zhun. I want to buy at 40 cents too.

grandfather and grandma aside, analyst fr Amfraser says:

"Given its unprecedentedly strong prospects, we argue that Sunsine should at the very least be trading at the top of its historical trading P/E of 6-7x. We therefore ascribe a target price of S$0.69 to Sunsine, which is pegged at 7x FY15F P/E."

www.nextinsight.net/index.php/story-arch...o-rise-says-amfraser

Last edit: 9 years 4 months ago by yeng.

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