SUN: Ice Cream Cake!?

Sunsweet Public Company Limited (SUN) wasn’t that popular among investors mainly due to the lack of liquidity, reflecting in low trading volume despite having a fair fundamental. 

SUN’s strength is that the company operates in both upstream, midstream and downstream. SUN has its own corn field to produce and distribute processed sweet corn and various processed agricultural products such as canned sweet corn, pouch sweet corn and frozen sweet corn, which mainly focus on overseas markets. 

The Company also operated its business of production and distribution of ready-to-eat foods under the standard of “KC” brand to largely support domestic customers by placing them on a convenience store shelf.

In 2019, SUN’s operating performance slightly stumbled, turning to book loss, but this year would be a good year for SUN after collecting a profit for the first six months as high as 66 million baht with a total revenue of 1,235 million baht.

If nothing goes wrong, SUN will end up this year with profit for sure. Moreover, SUN’s business is currently in the growth trend.

As SUN’s business is heavily export dependent, with exports accounting for 80% of the Company’s total sales volume, the Company could face foreign exchange risk and Covid-19 pandemic effects.

Due to foreign exchange risk, SUN has expanded its business by teaming up with Good Drink 2018 Co., Ltd. to produce and distribute sweet corn ice cream under the brand “KC”, and sell through retailers such as 7-Eleven.

As of 2019, the ice cream market is worth 13,000 million baht, therefore it is quite attractive to investors. But it isn’t that easy to take a slice of cake.