Fu Yu Corp - DBS Research 2020-01-15: Moulding For Growth

FU YU CORPORATION LTD (SGX:F13) | SGinvestors.io FU YU CORPORATION LTD (SGX:F13)

Fu Yu Corp - Moulding For Growth

  • Turnaround in manufacturing across all regions.
  • Favourable shift in product mix towards higher profitability and growth potential.
  • Improving margins; high cash level (0.11 Scts/share) and attractive yield at 6.4%.
  • Initiate with BUY. See Fu Yu Target Price.



Turnaround in manufacturing across all regions.

  • Manufacturing PMIs in China, Singapore, and Malaysia, where FU YU CORPORATION (SGX:F13)’s manufacturing facilities are located, are indicating an expansion in the manufacturing sector. We believe that this will lead to an uptick in earnings for Fu Yu.


Emphasis on products with higher profitability and growth potential.

  • Part of Fu Yu’s business strategy is to shift towards producing parts for products in the consumer, medical, and automotive space, which have higher profitability and growth potential, as compared to printing and imaging segment.





Cost efficiency to improve margins.

  • Fu Yu is also expanding its margins through cost enhancement initiatives. The redevelopment of its Singapore factory and consolidation of its China operations in Shanghai and Suzhou will further lift normalised net profit margins to 8.2% in FY2020F, from 5.4% in FY2018.


Strong financial positioning.






Lee Keng LING DBS Group Research | Singapore Research Team DBS Research | https://www.dbsvickers.com/ 2020-01-15
SGX Stock Analyst Report BUY INITIATE BUY 0.35 SAME 0.35



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