DBS raised the target price of Sunshine Energy (0757.HK) from holding to buying, and raised the target price from HK$1.40 to HK$1.90.

According to DBS, the stock price is only 10.7 times the earnings per share forecast for fiscal year 2011, and it is believed that encouraging fundamentals will support a further rebound in the stock price. DBS also said that after the 2009 shock, Sunshine Energy's stability in terms of delivery, pricing, and gross profit margin all improved.

The bank pointed out that solar energy delivery is strong and prices are stable. Recently, strong demand from Europe and the US has enabled Sunshine Energy to maintain a 100% operating rate.

The stock rose 4.29% yesterday to close at HK$1.46.