Genting Plantation
Page 1 of 1
Genting Plantation
Investment Highlight
- Expansion in Indonesia. As at December 2010, Genting Plantation is having 29,413 hectare planted area in Indonesia which represents 66% increase compared to 2009. Planted area in Indonesia has started to contribute to revenue since 2010. We expect revenue will be strongly boosted in FY2013/14.
- Small contributions from Johor Premium Outlet (JPO). JPO, the joint venture of Genting Plantation and Premium Outlets. is being launched in Dec 2011. We expect earnings contribution from JPO to between 1%-2% p.a. in FY12 net profit. We understand second JPO is in the pipeline to be established in the near future. We expect total earning contribution from JPO to between 5%-8% p.a. by then.
- Commendable margin. PBT margin of Genting Plantation has been consistently above 40%, outperforming its peers’ of 30%. We believe Genting Plantation could sustain the high PBT margin in years to come mainly attributable to effective cost management.
- Low dividend payout. Genting Plantation has maintained dividend payout ratio of less than 20% in past years which is significantly lower than its peer which is above 45%. This does not bode well for the company to attract interests from the yield-seeking investors.
- Rich valuation. The stock price has gone 8.02% ytd. Share price is currently trades at 17x FY12F PE which is above its mean of 15x.
- SELL with target price of RM8.14 based on 15x FY12F PE, which is at its mean.
- Expansion in Indonesia. As at December 2010, Genting Plantation is having 29,413 hectare planted area in Indonesia which represents 66% increase compared to 2009. Planted area in Indonesia has started to contribute to revenue since 2010. We expect revenue will be strongly boosted in FY2013/14.
- Small contributions from Johor Premium Outlet (JPO). JPO, the joint venture of Genting Plantation and Premium Outlets. is being launched in Dec 2011. We expect earnings contribution from JPO to between 1%-2% p.a. in FY12 net profit. We understand second JPO is in the pipeline to be established in the near future. We expect total earning contribution from JPO to between 5%-8% p.a. by then.
- Commendable margin. PBT margin of Genting Plantation has been consistently above 40%, outperforming its peers’ of 30%. We believe Genting Plantation could sustain the high PBT margin in years to come mainly attributable to effective cost management.
- Low dividend payout. Genting Plantation has maintained dividend payout ratio of less than 20% in past years which is significantly lower than its peer which is above 45%. This does not bode well for the company to attract interests from the yield-seeking investors.
- Rich valuation. The stock price has gone 8.02% ytd. Share price is currently trades at 17x FY12F PE which is above its mean of 15x.
- SELL with target price of RM8.14 based on 15x FY12F PE, which is at its mean.
mabs- Member
- Posts : 922 Credits : 1154 Reputation : 143
Join date : 2011-11-17
Similar topics
» Genting Plantation earnings forecast raised
» march 6th - Stocks To Watch Genting, GenM, plantation counters, Asia Bio, Kinsteel, Minetech
» Nov 21st - Companies in the news SapuraKencana, Genting Plantation, Rimbunan Sawit, Mah Sing, Petron, IJM, Systech
» Aug 29th - Stocks To Watch Index stocks, Kulim, Oriental, BIMB, Nakamichi, Genting Plantation, Mudajaya, Media Chinese, Tanjung Offshore, Supermax, Fa
» IJM Plantation
» march 6th - Stocks To Watch Genting, GenM, plantation counters, Asia Bio, Kinsteel, Minetech
» Nov 21st - Companies in the news SapuraKencana, Genting Plantation, Rimbunan Sawit, Mah Sing, Petron, IJM, Systech
» Aug 29th - Stocks To Watch Index stocks, Kulim, Oriental, BIMB, Nakamichi, Genting Plantation, Mudajaya, Media Chinese, Tanjung Offshore, Supermax, Fa
» IJM Plantation
Page 1 of 1
Permissions in this forum:
You cannot reply to topics in this forum
|
|