This is my first post on my blog and I would like to share with you a counter that have recently invested in, China Sunsine (SGX: CH8)
Current Price: $1.04 (Invested at $0.88 before starting this blog, check out my current portfolio by clicking the tab above)
Target Price: $1.15 - $1 .20
Upside: 13%
Business Description
China Sunsine Chemical Holdings Ltd., an investment holding company, engages in the manufacture and sale of rubber chemical products in the People's Republic of China, rest of Asia, the United States, Europe, and internationally. The company offers rubber accelerators, anti-oxidant agents, vulcanizing agents, anti-scorching agents, and insoluble Sulphur used for the production of tires and other rubber-related products. The company was incorporated in 2006 and is based in Singapore, with tire companies being its main clients. China Sunsine Chemical Holdings Ltd. is a subsidiary of Success More Group Limited
Key Points and Catalyst
The global tire market is expected to reach USD $319bn by 2022, which will increase the demand for rubber accelerators and related agents. China Sunsine will benefit from this trend as it currently holds a market leading position both in China and globally with 31% and 18% market share respectively, as of FY16.
The world demand for tires is expected to increase by 4.1% p.a. to 3.0 billion units in 2019. Motor vehicles will remain the dominant tire market, while motorcycles and other applications will grow fastest. The Asia Pacific region, from which the majority of China Sunsine’s revenue is derived, currently accounts for more than 50% of the world’s tire market and is expected to grow at a higher average rate of 5.8%.
China Sunsine's emphasis on environmental protection has paid off as the Chinese government has tightened its grip on environmental standards. In several episodes since FY14, government crackdown on non-compliant producers has choked market supply of accelerators. Consequently, the group has been able to charge higher prices and capture market share.
China Sunsine has built a firm competitive advantage through its strengths, which include ease of scalability and strong engineering capabilities.
Potential Catalyst: China Sunsine’s major catalyst involves the increase in sales (quantity and price) of rubber accelerators and similar agents due to the lack of competitors and the upward trend in tire demand, notably in the Asia Pacific. Additionally, as China Sunsine continues to grow, its equity will garner more coverage which should positively impact the share price.
Current Price: $1.04 (Invested at $0.88 before starting this blog, check out my current portfolio by clicking the tab above)
Target Price: $1.15 - $1 .20
Upside: 13%
Business Description
China Sunsine Chemical Holdings Ltd., an investment holding company, engages in the manufacture and sale of rubber chemical products in the People's Republic of China, rest of Asia, the United States, Europe, and internationally. The company offers rubber accelerators, anti-oxidant agents, vulcanizing agents, anti-scorching agents, and insoluble Sulphur used for the production of tires and other rubber-related products. The company was incorporated in 2006 and is based in Singapore, with tire companies being its main clients. China Sunsine Chemical Holdings Ltd. is a subsidiary of Success More Group Limited
Key Points and Catalyst
The global tire market is expected to reach USD $319bn by 2022, which will increase the demand for rubber accelerators and related agents. China Sunsine will benefit from this trend as it currently holds a market leading position both in China and globally with 31% and 18% market share respectively, as of FY16.
The world demand for tires is expected to increase by 4.1% p.a. to 3.0 billion units in 2019. Motor vehicles will remain the dominant tire market, while motorcycles and other applications will grow fastest. The Asia Pacific region, from which the majority of China Sunsine’s revenue is derived, currently accounts for more than 50% of the world’s tire market and is expected to grow at a higher average rate of 5.8%.
China Sunsine's emphasis on environmental protection has paid off as the Chinese government has tightened its grip on environmental standards. In several episodes since FY14, government crackdown on non-compliant producers has choked market supply of accelerators. Consequently, the group has been able to charge higher prices and capture market share.
China Sunsine has built a firm competitive advantage through its strengths, which include ease of scalability and strong engineering capabilities.
Potential Catalyst: China Sunsine’s major catalyst involves the increase in sales (quantity and price) of rubber accelerators and similar agents due to the lack of competitors and the upward trend in tire demand, notably in the Asia Pacific. Additionally, as China Sunsine continues to grow, its equity will garner more coverage which should positively impact the share price.
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