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13 comment(s). Last comment by commonsense at Jan 25, 2019 3:56 PM
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yeap boon tat
21 posts

Posted by yeap boon tat > Feb 16, 2012 9:53 PM | Report Abuse

Is BLD a good investment stock with just 80million shares?

103 posts

Posted by sh2383jbt > Jan 9, 2013 11:08 PM | Report Abuse

Agreed with all. Just wait and see the big return...

3923 posts

Posted by logitrader > Nov 27, 2014 2:19 PM | Report Abuse


3923 posts

Posted by logitrader > Feb 28, 2015 12:35 AM | Report Abuse


3923 posts

Posted by logitrader > Apr 29, 2015 5:50 PM | Report Abuse


1185 posts

Posted by Ckk2266 > Nov 8, 2015 8:11 PM | Report Abuse

Salted fish alive....

1183 posts

Posted by Diamond7 > Nov 11, 2015 2:02 PM | Report Abuse

Up....up...up....any good news?

Thomas Chan Yeu Wai
30 posts

Posted by Thomas Chan Yeu Wai > Mar 15, 2016 10:47 PM | Report Abuse


20 posts

Posted by investlah > Mar 28, 2017 3:42 PM | Report Abuse


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Posted by investlah > Mar 28, 2017 3:47 PM | Report Abuse


524 posts

Posted by zayady > Jul 13, 2018 12:34 AM | Report Abuse


105 posts

Posted by LouiseS > Jan 5, 2019 4:00 PM | Report Abuse

Total planted area = 31,200 hectares, with 84% in maturity stage. Crude palm oil produced = 115,500 metric tonnes, total volume of palm oil products sold = 760,000 metric tonnes
Top three importing countries of Malaysia palm oil products are India, European Union and China.


474 posts

Posted by commonsense > Jan 25, 2019 3:56 PM | Report Abuse

BLD Plantation is not the only plantation company that posted bad results in the most recent quarters. If you go through other financial reports, most (if not all) plantation companies are affected by the low CPO price in Jul-Sept period.

In terms of valuation, all plantation stocks are currently trading at a high PE multiple (for those that still managed to record profit) or in BLD case, negative PE. This is reflective of the downturn cycle of the plantation industry. Don't think that the industry will reverse their down cycle anytime soon given the general demand of the commodity is expected to go down in the future. China for example, is negotiating with US to take in more agriculture products from US which would potentially include soybean (or soybean oil). In general, Chinese consumption of oil would not actually go up that much so the increase of soybean oil import from US to China would actually be at the expense of other oil commodities from other countries (in particular palm oil from Indonesia and Malaysia). Another issue is on the European demand of palm oil which is expected to go down exponentially given the proposed ban of palm oil use in food and transportation industries in the future. They have already agreed to phase out the use of palm oil in transport fuel by 2030. Some countries like France and Norway have already started to move away from palm oil.

If you are still interested in the plantation industry then you should try to look at other companies first (at least until BLD is really on a stable footing). You will notice that most plantation stocks have fallen but PE valuation is still high. As I mentioned earlier, this is normal given that the industry cycle is currently at the bottom as reflected by the CPO price. It is better for you to do a PE calculation using an average 5 years PAT to take into account the cyclical nature of the industry. With this in mind you need to have a slightly long-term investment horizon when buying into oil plantation companies.

If you are looking to diversify your portfolio outside of BLD (due to its earnings uncertainties and bleak growth outlook) I would recommend you to look at MBMR.

MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.9x PE (based on target FY18 profit of RM145mil. 9m profit is already RM106mil). PB is low at only 0.7x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17.

FY19 growth will be driven by the still high demand of the new Myvi and the newly launched SUV Aruz and also the newly revamp Alza in 2H19. The recent announcement of closure and potential disposal of the loss-making alloy wheel manufacturing business alone is expected to boost the company’s profit by an additional RM10mil to RM20mil. I am projecting a profit to shareholder of RM170 mil for FY19 which at the current price values MBMR at only 5.9x PE.

Please go through the analyst reports (https://klse.i3investor.com/servlets/stk/pt/5983.jsp) and do your own analysis before making any decisions. There are 8 analysts in total covering the stock with most of them having a TP of above RM3 (all have a buy rating). The average TP for the 8 analysts is around RM3.50.

Good luck.

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