Title Grape King (1707 TT) Buy, TP: NT$234
  Chilisin (2456 TT) Buy, TP: NT$120
  M31 Technology (6643 TT) -- Underwriting
  Bioteque (4107 TT) Buy, TP: NT$142
  Mediatek (2454 TT) Buy, TP: NT$400
  Mediatek (2454 TT) Buy, TP: NT$400
  Oriental Union Chemical Corp (1710 TT) Buy, Raise TP to NT$40
  Sunny Friend (8341 TT) Buy, TP: NT$270
  China Steel Chemical (1723 TT) Buy, TP: NT$190
  Sunny Friend (8341 TT) Buy, TP: NT$270
 
More Titles
Title:Oriental Union Chemical Corp (1710 TT) Buy, Raise TP to NT$40
Download File:1710 TT OUCC long report summary 180627--sinopac.pdf 
 
Summary:Raise TP to NT$40 (2.2x 2018 P/B) from NT$36 (2x old 2018F P/B); Maintain Buy: 1) Powerful EG demand in China as downstream chemical fiber plants have been able to sustain a UTR of 90%+ recently, and ~3mn tonnes of polyester capacity is expected to launch in China this year; 2) Relatively limited impact from new EG capacity this year with new effective global EG capacity estimated at ~1mn tonnes and demand growth at 1mn tonnes; 3) Wider spread in 2Q18 vs. 1Q18 given the intensive EG turnaround schedule in 2Q18, added with moderate decline in inventory due to sustained strength in demand for chemical fiber and PET from the downstream and upstream; 4) OUCC is currently trading at 1.8x 2018 P/B vs. historical range of 1-2x. However, eyeing wider spread vs. last year amid improving EG supply and demand, we project a 60% YoY earnings growth and thus raise our 2018F earnings by 16% and our 2018 BVPS estimate from NT$17.7 to NT$18.12.
  
Date:2018/06/27
Author:TaiwanResearch.com
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