Thong Guan Industries’s 1Q21 core net profit formed 29% of our FY21F forecast. Its margins strengthened yoy, while sales shot up 15.6% yoy. While the group has revised selling prices, the continued rise in resin prices could temporarily eat into margins before another round of price revision. Thong Guan nonetheless looks poised for more turnover growth, with capacity expansion slated for end-2021. Reiterate Add on a strong outlook.
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