KGI Research analyst Joel Ng has initiated “outperform” on China-based chemical company, Jiutian Chemical, with a target price of 14.5 cents.

The target price, says Ng, is based on 7 times price-to-earnings (P/E) to its FY2022 earnings per share (EPS) of RMB10.3 cents.

The company made a turnaround in 2020, where it made net profit of RMB173 million ($35.9 million) for the FY, reversing from losses of RMB279 million in FY2019. The company is now the second-largest dimethylformamide (DMF) producer in China after one of its largest competitors ceased operations in 2020.

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