It is still premature to expect a steep recovery in second quarter earnings (Q2 16) versus a full-year forecasts in the oil palm plantation sector after a dismal performance in the first quarter (Q1 16).
Maybank Investment Bank Research in a note said on Wednesday this was premise on a still low Q2 output and the new 5% to 5.5% crude palm oil (CPO) export tax and windfall tax for Peninsular Malaysia planters that kicked in from April. Price needs to punch higher to benefit pure upstream players, it said.
“We believe the CPO export tax and windfall tax mean that CPO price achieved by upstream planters in Malaysia could be lower by RM88 per tonne - RM159 per tonne than the actual CPO spot prices. Hence, while we generally expect a quarter-on-quarter (qoq) earnings recovery in Q2, it is premature to expect a sharp recovery in earnings relative to the full year earnings forecasts. June 2016’s fresh fruit bunch (FFB) output and CPO average selling price (ASP) are therefore crucial factors to watch.
For Free Signals and other KLSE online updates, click here OR Give A Missed Call : +60350219047 Follow Us On Twitter : www.twitter.com/epicresearchmy Like Us On Facebook : www.facebook.com/EpicResearchMalaysia Need Any Assistance Feel Free To Mail Us at : info@epicresearch.my
Maybank Investment Bank Research in a note said on Wednesday this was premise on a still low Q2 output and the new 5% to 5.5% crude palm oil (CPO) export tax and windfall tax for Peninsular Malaysia planters that kicked in from April. Price needs to punch higher to benefit pure upstream players, it said.
“We believe the CPO export tax and windfall tax mean that CPO price achieved by upstream planters in Malaysia could be lower by RM88 per tonne - RM159 per tonne than the actual CPO spot prices. Hence, while we generally expect a quarter-on-quarter (qoq) earnings recovery in Q2, it is premature to expect a sharp recovery in earnings relative to the full year earnings forecasts. June 2016’s fresh fruit bunch (FFB) output and CPO average selling price (ASP) are therefore crucial factors to watch.
No comments:
Post a Comment