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  Sinbon (3023 TT) U/G Buy, TP: NT$202
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  ESG Note: TXC (3042 TT) Buy: TP: NT$100
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  Chenbro Micom (8210 TT) Neutral
  Makalot (1477 TT) U/G Buy, TP: NT$200
  ESG Equity Note: Mediatek (2454 TT) Raise TP to NT$920; Maintain Buy
  Macauto (9951 TT) Buy, TP: NT$90
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Title:Equity Note: Taiwan Hon Chuan (9939 TT) Buy, TP: NT$66
Download File:9939 TT Taiwan Hon Chuan note 200706--sinopac.pdf 
Summary:Lower TP to NT$66 (12x 2021F P/E); Maintain Buy: 1) We project sales will drop by ~7% in 2020F due to decreased UTR for its Asian plants (COVID-19) and product price cuts (lower feedstock prices); we expect earnings will rise by ~2% YoY due to resumed demand, cheaper feedstocks, and a favorable base (one-off expense of NT$200mn in 2019). 2) We project sales/earnings growths of ~12%/16% in 2021F assuming productions return to normal and on contribution from new facilities in China and Southeast Asia starting in late 2020; 3) Valuation: The stock trades at 11x 2020F P/E, vs. 3-year historical range of 11-16x (13-14x on average). We cut our 2020F EPS to NT$4.80 from NT$5.85 due to COVID-19 impact but anticipate sales and earnings will return to growth in 2021. HON CHUAN plans to pay cash dividend of NT$3, a yield of 5.2%. Our previous TP was NT$76 (13x old 2020F P/E).
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