3 industry woes Wilmar must hurdle by 1Q13

More urgent concerns than the 8% price hike.

According to Phillip Securities, Wilmar share price has increased significantly recently. The company’s share has appreciated by about 13% since our rating upgrade on 12 November 2012 at S$3.17.

Similarly, CPO prices have also increased by about 8% over the past one month. Meanwhile, China’s soybean crushing margin went back to negative region again since mid-Oct, indicating that the soybean crushing situation in China still remain difficult.

Here's more from Phillip Securities:

We believe CPO price will continue to gain some strength in 1Q13 before fading gradually going into 2Q13 amid: 1) seasonally weak CPO demand in absence of major celebrations/festivities in Asia; 2) stronger CPO supply production coming from both Malaysia (due to recovery from lagged El Nino impact) and Indonesia (due to improving plantation age profile); and 3) record-high palm oil stockpile at the start of 2013.

Despite lower edible oil prices, we do not expect these to have much of a negative impact on Wilmar albeit revenue may fall. Nonetheless, being a significant downstream player, the group may benefit from lower feedstock prices. In fact, based on our estimates, it still sources around 55% of its requirements from third party plantation companies for its Palm & Lauric business.



More From Singapore Business Review

--

Get stories like this on the Yahoo app and discover more every day.
Download it now.
Loading...

Explore Related Contents

 
Recent Quotes
Symbol Price Change % Chg 
Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
You need to enable your browser cookies to view your most recent quotes.
 
Sign-in to view quotes in your portfolios.

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.225-0.045-16.67%
    N21.SI
    0.135+0.004+3.05%
    41F.SI
    0.191-0.007-3.54%
    40F.SI
    0.180.00-2.70%
    40E.SI
    0.1060.0000.00%
    5WA.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.60+0.28+87.50%
    AWC.SI
    0.48+0.17+54.84%
    BCD.SI
    0.35+0.08+29.63%
    BQO.SI
    0.515+0.065+14.44%
    T55.SI
    0.155+0.019+13.97%
    BKZ.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.225-0.045-16.67%
    N21.SI
    0.215-0.040-15.69%
    AWI.SI
    0.138-0.017-10.97%
    1C0.SI
    0.11-0.01-9.84%
    BRR.SI
    0.575-0.055-8.73%
    600.SI

Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.4040-0.0035-0.25%
    USDSGD=X
    1.4813-0.0076-0.51%
    EURSGD=X
    1.7461-0.0204-1.15%
    GBPSGD=X
    79.5820-0.48-0.60%
    SGDJPY=X
    5.5214+0.0106+0.19%
    SGDHKD=X
    3.1593-0.0033-0.10%
    SGDMYR=X
    9,520.9463-3.3887-0.04%
    SGDIDR=X
    4.8855+0.0077+0.16%
    SGDCNY=X
    1.0768-0.0087-0.80%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,258.00+6.60+0.53%
    GCJ17.CMX
    18.34+0.23+1.26%
    SIH17.CMX
    88.62-0.99-1.10%
    ^XAU
    2.68+0.02+0.92%
    HGK17.CMX
    54.02-0.43-0.79%
    CLJ17.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.80-0.07
    ^FVX
    2.32-0.07
    ^TNX
    2.95-0.07
    ^TYX