19/07/2012 (Bernama) - OSK Research Sdn Bhd has increased its financial year 2013 earnings estimates for TSH Resources Bhd and projected a 25 per cent year-on-year earnings growth next year.

In a research note today, OSK said, although fresh fruit bunches production growth would be softer than initially forecast, should the anticipated El Nino bring on drought to the region, organic growth from the company's young trees would sufficiently buffer it against a hard landing in production.

"As TSH has planted over 21,800 hectares of oil palm since 2006, 75 per cent of its trees are still below peak production, thus giving it the fourth most favourable tree age within our 18-stock plantation universe," it said.

OSK said organic production growth from its young trees would sufficiently mitigate the production losses arising from the anticipated dry weather.

"TSH's rising share of production from its Kalimantan operations will also boost crude palm oil production somewhat, as the CPO extraction rates from the region tend to be higher due to the region's less weathered soil," it said.