Fuxing - Fuxing China started at Buy by DMG with $0.255 target

Stock Name: Fuxing
Company Name: FUXING CHINA GROUP LIMITED
Research House: DMG

DMG starts Fuxing China Group (DC9.SG) at Buy with $0.255 target price, based on 6.0x P/E. Says zipper maker severely undervalued with stock trading at 5.3% discount to net cash position, despite stronger balance sheet vs industry average, says Dow Jones.



Bullish on outlook as China seeks to increase consumers’ purchasing power, while company rolls out more initiatives to boost earnings, including boosting R&D to raise margins. Notes China’s zipper market highly fragmented with more than 2,000 local players.

“While there are worries that this might mean the barriers to entry are low for the industry in which Fuxing operates, we note that the company’s customers include renowned brands that would prefer to work with the bigger zipper manufacturers. This is thus the premium that Fuxing has over its much smaller competitors.”



Shares +3.2% at $0.16.