KUALA LUMPUR: AmResearch has maintained its BUY call on JAYA TIASA HOLDINGS BHD [], with an unchanged fair value of RM8.51 based on a PE of 15 times FY12F EPS of 56.7 sen per share.
It said in a note July 28 that Jaya Tiasa recently announced a better-than-expected net profit of RM147 million for FY11 (+503% versus FY10), which was 16% and 12% above our and consensus estimates, respectively.
'Post-FY11 results, we had upgraded the stock to a BUY (from hold previously). The oil palm division, whose pre-tax profit surged 460% to RM105 million in FY11, will continue to be the star performer in the next two to three years.
'We expect FFB production to grow significantly by 45% to 520,000 tonnes in FY12F and by another 50% to 750,000 tonnes in FY13F,' it said.
AmResearch said Jaya Tiasa's mature hectarage was expected to rise 50% to over 37,000ha in FY12F and by another 30% to about 50,000ha by FY13F, after adding 70% to 25,058ha as at end-FY11.
The research house said its CPO assumption for each of FY12F-FY14F was RM3,300/tonne.
Apart from sustained demand from India for its logs, rising demand for plywood products from Japan for its reCONSTRUCTION [] efforts will also lend support to the company's performance, it said.
'Jaya Tiasa's well diversified markets put it in a good position to benefit from the strong timber market.
'Our fair PE of 15 times is well within the stock's historical five-year forward PE of between 6x and 36x, and below the average of 16 times. Jaya Tiasa is now trading at an attractive PE of 12 times,' it said.
It said in a note July 28 that Jaya Tiasa recently announced a better-than-expected net profit of RM147 million for FY11 (+503% versus FY10), which was 16% and 12% above our and consensus estimates, respectively.
'Post-FY11 results, we had upgraded the stock to a BUY (from hold previously). The oil palm division, whose pre-tax profit surged 460% to RM105 million in FY11, will continue to be the star performer in the next two to three years.
'We expect FFB production to grow significantly by 45% to 520,000 tonnes in FY12F and by another 50% to 750,000 tonnes in FY13F,' it said.
AmResearch said Jaya Tiasa's mature hectarage was expected to rise 50% to over 37,000ha in FY12F and by another 30% to about 50,000ha by FY13F, after adding 70% to 25,058ha as at end-FY11.
The research house said its CPO assumption for each of FY12F-FY14F was RM3,300/tonne.
Apart from sustained demand from India for its logs, rising demand for plywood products from Japan for its reCONSTRUCTION [] efforts will also lend support to the company's performance, it said.
'Jaya Tiasa's well diversified markets put it in a good position to benefit from the strong timber market.
'Our fair PE of 15 times is well within the stock's historical five-year forward PE of between 6x and 36x, and below the average of 16 times. Jaya Tiasa is now trading at an attractive PE of 12 times,' it said.
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