The Edge Markets (30/09/2019) - KUALA LUMPUR (Sept 30): Kuala Lumpur Kepong, Genting Plantations and Sarawak Oil Palms are now all rated buy by RHB Investment Bank Bhd after it turns bullish on the plantations sector, upgrading the sector to overweight. 

RHB expects crude palm oil prices (CPO) to rerate upwards in 4Q and continue climbing in 1H next year. RHB projects CPO prices to average RM2,200 a metric ton for 2019 and RM2,400 a ton for 2020, as compared to the current price of RM2,149 a ton. 

RHB says it believes plantation stocks would also likely rerate on the back of this price movement, as CPO prices are the leading indicator for plantation companies' price-to-earnings ratios. 

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