KUALA LUMPUR — MIDF Research has upgraded Genting Plantations Bhd’s (GenP) earnings forecast to RM612.3 million for the 2022 financial year.
It has also maintained GenP’s forward year earnings as total production, assumptions on margins and blended cost are expected to be more reflective of forward anticipations.
MIDF Research said that GenP’s earnings for H1 2022, which surged by 87% year-on-year to RM353.6 million, was also driven by a lower net operational expenditure ratio, following their effective cost management.
“The net earnings came in above our expectations, making up 62% of the full-year estimate. It is, however, within the consensus estimates at 54%,” the research house said in a note today.
Hence, MIDF Research has maintained a “buy” call with a target price of RM8 for GenP.
Meanwhile, CGS-CIMB Securities Sdn Bhd has projected a lower net profit in H2 2022 for GenP due to the lower average selling price achieved for its crude palm oil and higher fertiliser costs.
“Furthermore, GenP has only applied 30% of its budgeted fertiliser applications for H1 2022 while fertiliser costs have doubled from a year ago, which would lead to higher fertiliser costs in H2,” it argued.
CGS-CIMB maintained its earnings forecasts but trimmed the target price to RM7.06, while keeping a “hold” call for GenP in view of limited price catalysts and the expectation of weaker earnings in H2 2022.
At 11am, GenP’s share price rose 17 sen to RM6.66, with a volume of 137,400 shares transacted. – Bernama, August 25, 2022
