PETALING JAYA: United U-Li Corp Bhd
’s dominance in the fragmented cable support systems (CSS) space will likely strengthen, as smallish competitors crumble under the pandemic pressure.
In the current health crisis, the cable support systems manufacturer is expected to benefit as its competitors, which are mostly smaller in size, face difficulties in fulfilling orders due to cash-flow constraints arising from the prolonged lockdowns, as well as inability to secure raw materials due to the worldwide shortage.
Being a dominant player, this provides United U-Li the opportunity to increase its market share and command pricing power, translating to strong and stable margins, said Kenanga Research. The brokerage noted that United U-Li had deferred its capacity expansion plans as construction progress had been affected by the ongoing lockdown.
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