Solid execution
■ Sunsine’s 1H21 net profit of Rmb265m (+94% qoq, +222% yoy) was above
expectations, mainly due to stronger than expected GPM.
■ The 2H outlook could be more muted; we expect profit spread to narrow on
the back of weaker downstream demand.
■ Valuation remains cheap at 3x FY22F P/E (ex-cash). We reiterate our Add
call with a higher TP of S$0.68.