MARKET DEVELOPMENT
IOI Corp's Share Price To Strengthen On CPO Price Rebound: HwangDBS
IOI Corp's Share Price To Strengthen On CPO Price Rebound: HwangDBS
19/11/2013 (Bernama) - HwangDBS Vickers Research expects IOI Corp Bhd's share price to strengthen over the next 12 months on a near-term rebound in crude palm oil (CPO) prices and a pick-up in demand from China and India.
The research house reiterates a 12-month target price of RM6.15, representing a 13 per cent upside.
At mid-day Tuesday, IOI's share price rose 20 sen to RM5.66 with 4.475 million shares traded.
HwangDBS forecasts CPO prices will average RM2,570 per metric tonne in 2014, nine per cent higher than in the third quarter of 2013.
The company's growth will be fuelled by Indonesia's new biofuel policy, a recovering global economy and the stricter use of trans-fats in the US, HwangDBS said in a research note here.
Meanwhile, RHB Research has retained its forecasts for the company's financial years 2014 (FY14) and 2015 (FY15) and expects CPO prices to hit RM2,500 and RM2,600 per metric tonne for FY14 and FY15 respectively.
RHB has maintained a neutral rating on IOI, but revised its fair value slightly to RM6 from RM5.96, after incorporating the company's latest net debt.
IOI on Monday reported a 50 per cent year-on-year drop in net profit to RM302 million for the first quarter of FY14 ended Sept 30, on losses of foreign currency borrowings and lower profits from the plantation segment.
The research house reiterates a 12-month target price of RM6.15, representing a 13 per cent upside.
At mid-day Tuesday, IOI's share price rose 20 sen to RM5.66 with 4.475 million shares traded.
HwangDBS forecasts CPO prices will average RM2,570 per metric tonne in 2014, nine per cent higher than in the third quarter of 2013.
The company's growth will be fuelled by Indonesia's new biofuel policy, a recovering global economy and the stricter use of trans-fats in the US, HwangDBS said in a research note here.
Meanwhile, RHB Research has retained its forecasts for the company's financial years 2014 (FY14) and 2015 (FY15) and expects CPO prices to hit RM2,500 and RM2,600 per metric tonne for FY14 and FY15 respectively.
RHB has maintained a neutral rating on IOI, but revised its fair value slightly to RM6 from RM5.96, after incorporating the company's latest net debt.
IOI on Monday reported a 50 per cent year-on-year drop in net profit to RM302 million for the first quarter of FY14 ended Sept 30, on losses of foreign currency borrowings and lower profits from the plantation segment.