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NewsRHB Research FV for Fitters at RM1.05 (9318)
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RHB Research FV for Fitters at RM1.05 (9318)
by hlk Wed 18 Jul 2012, 11:27
KUALA LUMPUR: RHB Research Institute has a fair value of RM1.05 for Fitters Diversified as its new engine of growth, which is third-party green palm oil milling, has finally been set in motion.
It said on Wednesday that after the first two signing in July 2012 with Anglo-Eastern and Tradewinds Plantation respectively, more is expected to follow in the immediate term.
“A third-party green palm oil milling project gives Fitters three bites on the same cherry: (1) One-off profits from the EPC of plant and equipment; (2) A recurring management fee or share of profits; and (3) A recurring off-take spread,” it said. “Earnings impact from these third-party green palm oil milling ventures will be felt from FY12/13, and based on our projection, their contributions to group profits will rise from 7% in FY12/13 to 29% in FY12/14 and 41% in FY12/15, making Fitters a must-have' stock for green/growth funds,” said RHB Research.
It said on Wednesday that after the first two signing in July 2012 with Anglo-Eastern and Tradewinds Plantation respectively, more is expected to follow in the immediate term.
“A third-party green palm oil milling project gives Fitters three bites on the same cherry: (1) One-off profits from the EPC of plant and equipment; (2) A recurring management fee or share of profits; and (3) A recurring off-take spread,” it said. “Earnings impact from these third-party green palm oil milling ventures will be felt from FY12/13, and based on our projection, their contributions to group profits will rise from 7% in FY12/13 to 29% in FY12/14 and 41% in FY12/15, making Fitters a must-have' stock for green/growth funds,” said RHB Research.
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