DBS: Yangtze Optical Fibre and Cable JSC –

alanyeo

2 years ago

In-depth Analysis: Hitting an inflection point

Bottom out from the extreme cable price level after c.60% price recovery in China Mobile’s tender under the improving supply-demand dynamics
Operators’ capex hike and global demand recovery underpins further cable demand and price growth
Expect cable ASP for YOFC to recover 24% in FY22, leading to 2.9ppts gross margin expansion and 13% earnings upward revision
Upgrade to BUY from HOLD with a higher TP of HK$15.8, benefiting from cable price recovery