KUALA LUMPUR, Aug 25 — MIDF Research has upgraded Genting Plantations Bhd’s (GenP) earnings forecast to RM612.3 million for the financial year 2022, while maintaining its forward year earnings as the total production, assumptions on margins and blended cost to be more reflective of forward anticipations.
It said GenP’s earnings for the first half of 2022 (H1 2022), which surged by 87 per cent year-on-year to RM353.6 million was also driven by a lower net operational expenditure ratio, following GenP’s effective cost management.
“The net earnings came in above our expectations, making up 62 per cent of full-year estimate. It is however within consensus estimates at 54 per cent,” 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 lower net profit in H2 2022 for GenP due to lower average selling price achieved for its crude palm oil (CPO) and higher fertiliser costs.
“Furthermore, GenP has only applied 30 per cent of its budgeted fertiliser applications for this year in H1 and fertiliser costs have doubled from a year ago, which would lead to higher fertiliser costs in H2,” it said.
The research house 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
