 2013-08-30 |
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Business Times
With rising oil prices and a growing trend in the increase of BOPP prices in China, up by approximately 3-5% in Q3, coupled with contributions from new production facilities, YC (4306) and ACHEM (1715) are seeing promising improvements in their Q3 operations. Compared to the lower levels of the previous year, analysts estimate a year-on-year growth rate of up to 30% for the quarter.
YC believes that with increasing demand in the Chinese market and the gradual ramp-up of new production capacities, Q3 business in tape, film, and packaging sectors will outperform Q2.
In addition, ACHEM is benefiting from a shortage in the PVC tape market. Its Yangmei plant in Taiwan has increased monthly production of polyethylene (PE) blown film by 300 tons and coating lines by 3.6 million square meters, which will boost momentum in the second half of the year. To scale up operations, ACHEM has launched an expansion plan for tape production across three regions. Taiwan is adding a new OPP niche production line to enhance gross margin, while in China and Vietnam, ACHEM is expanding PVC and OPP production. Two additional production lines are planned for the second half of the year, with Q3 revenue expected to accelerate significantly.
YC currently operates seven BOPP production lines across Taiwan and China, with four in Taiwan and three in China, increasing total monthly capacity from 12,500 tons to 15,000 tons. Analysts estimate a year-on-year growth of 20-30% for Q3 operations.
Furthermore, YC's subsidiary Wangzhou Construction recorded significant profits from the "Cloud Quality" project, with a 2.56-fold increase in profit in Q2 and an EPS of NT$1.47 for the first half of the year. Analysts project that YC’s EPS for the year could reach approximately NT$2.50. |
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