KUALA LUMPUR: Shares of PPB GROUP BHD [] rose to a high of RM17 on Friday, May 13 as its major profit contributor, Wilmar was raised to Outperform from Neutral on its improving earnings prospects.
At 3.46pm, PPB was up 32 sen to RM16.98, the strongest gain in recent weeks. There were 211,300 shares done at prices ranging from RM16.54 to RM17.
The FBM KLCI rose 10.72 points to 1,543.01. Turnover was 911.07 million shares valued at RM1.25 billion. There were 433 gainers, 263 losers and 297 stocks unchanged.
Wilmar posted a net profit of US$386.7 million for the quarter ended March 31, 2011. The net profit included the fair value loss on embedded derivatives of its convertible bonds and a profit within the sugar segment relating to pre-acquisition hedging reserves.
'Excluding these exceptional items, the group would have recorded a 3% growth in net profit to US$407.8 million (1Q2010: US$394.2 million),' it said to the exchange. Wilmar said revenue was up 41% to US$9.5 billion for the quarter driven primarily by higher prices of agricultural commodities while bulk sales volume was 14% lower.
CIMB Equities Research upgraded Wilmar to Outperform from Neutral on its improving earnings prospects.
'1Q11 core earnings were broadly in line, at 26% of our FY11 estimate and 25% of consensus. All divisions with the exception of consumer products posted better earnings. We are keeping our earnings forecasts but raise our target price to S$6.20, now based on 16x forward P/E (10% premium to the market) against 14.5x (market P/E) previously in view of its improving earnings prospects.
' The stock has also been upgraded to Outperform on expectations of better earnings in subsequent quarters. Furthermore, it has underperformed the market by 17% since we downgraded it on its 3Q10 earnings disappointment. Potential catalysts are a lifting of price controls in China, potential M&As and better sugar earnings,' it said.
At 3.46pm, PPB was up 32 sen to RM16.98, the strongest gain in recent weeks. There were 211,300 shares done at prices ranging from RM16.54 to RM17.
The FBM KLCI rose 10.72 points to 1,543.01. Turnover was 911.07 million shares valued at RM1.25 billion. There were 433 gainers, 263 losers and 297 stocks unchanged.
Wilmar posted a net profit of US$386.7 million for the quarter ended March 31, 2011. The net profit included the fair value loss on embedded derivatives of its convertible bonds and a profit within the sugar segment relating to pre-acquisition hedging reserves.
'Excluding these exceptional items, the group would have recorded a 3% growth in net profit to US$407.8 million (1Q2010: US$394.2 million),' it said to the exchange. Wilmar said revenue was up 41% to US$9.5 billion for the quarter driven primarily by higher prices of agricultural commodities while bulk sales volume was 14% lower.
CIMB Equities Research upgraded Wilmar to Outperform from Neutral on its improving earnings prospects.
'1Q11 core earnings were broadly in line, at 26% of our FY11 estimate and 25% of consensus. All divisions with the exception of consumer products posted better earnings. We are keeping our earnings forecasts but raise our target price to S$6.20, now based on 16x forward P/E (10% premium to the market) against 14.5x (market P/E) previously in view of its improving earnings prospects.
' The stock has also been upgraded to Outperform on expectations of better earnings in subsequent quarters. Furthermore, it has underperformed the market by 17% since we downgraded it on its 3Q10 earnings disappointment. Potential catalysts are a lifting of price controls in China, potential M&As and better sugar earnings,' it said.
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