 2014-04-28 |
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(Precision News, Reporter Hou Liang-Ru)
YC (4306), optimistic about ACHEM's (1715) current cash dividend yield—which is projected at NT$1.20 per share, translating to an approximate yield of 5.7% based on ACHEM's closing price last Friday—has decided to increase its investment. Through its wholly-owned subsidiary, YC BVI, located in the British Virgin Islands, YC purchased approximately 19.92 million shares of ACHEM at an average price of NT$15.44 per share.
Following this acquisition, YC BVI will hold 5.13% of ACHEM’s shares, totaling around 20.25 million shares. Including the shares held by the parent company YC (174 million shares, approximately 49.69% ownership), YC’s overall stake in ACHEM will rise to 54.82%.
YC has long maintained a stake of over 40% in ACHEM, with both companies having the same chairman, Li Zhixian, which gives them absolute control. The recent acquisition of additional ACHEM shares through the subsidiary was driven by a recent drop in ACHEM’s stock price due to the Fourth Nuclear Power Plant controversy and the F-share storm. YC sees the investment as valuable due to the attractive dividend yield and long-term investment potential.
Looking ahead, Li Zhixian has indicated that due to an anticipated 10% increase in demand for adhesive tapes in China this year, ACHEM is expected to achieve a double-digit growth target for annual revenue with new production capacity coming online. Profitability is expected to improve as well, benefiting from higher-margin products like PVC tapes and solvents, and the production of upstream raw material, butyl acrylate, which is expected to reduce costs and boost overall gross margin.
ACHEM’s major products and their revenue contributions are approximately: OPP tapes 52%, PVC tapes 33%, and specialty products 10%. The domestic and international sales ratio is 30% and 70%, respectively. The company is the leading PVC tape manufacturer in China, holding a market share of about 25%, with Hebei Huaxia being the second-largest player with a market share of around 20%. |
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