$Frencken (E28.SG)$ Price rose on China reopening and UOBKH ...

Price rose on China reopening and UOBKH report. It raised tp to 1.36 from 1.07.

Positive outlook for key customer and improving cost pressure. ASML reported a strong 4Q22 earnings growth of 28% yoy on 25 Jan 23 and guided for sales growth of more than 25% yoy in 2023 as demand remains high. They expect Frencken to benefit from this guidance as ASML contributed around 30% of its total revenue as of 1H22. Also, Frencken's gross margin should improve qoq as electricity costs in Europe are falling and Frencken had passed on cost increases to customers in 4Q22. Upgrade to buy with a 27% higher target price of 1.36.