SINGAPORE (Oct 12): CIMB has upgraded its call on Riverstone Holdings from “hold” to “add”, on falling raw material prices and capacity expansion, with a new target price of $1.92, from $1.85 previously.

Come end of this year, the company’s production capacity would have increased to 5.2 billion pieces, up from 4.2 billion pieces at end of last year. The company has indicated that these additional one billion pieces have been taken up by orders from existing and new customers.

This has given the company the optimism to further boost this capacity by another one billion pieces in the third quarter next year. The company is now operating at a 90% capacity utilisation rate, which is close to the optimal, notes CIMB.

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