Below expectations. Ta Ann's 1Q12 core net profit of MYR11m (-70% QoQ, -57% YoY) accounted for 7% of our and 6% of consensus full year forecasts. The significant shortfall is due to a weak performance at the timber division, and lower palm oil earnings. We cut our FY12-14 net profit estimates by 16-20% but maintain our BUY call with a lower TP of MYR7.50 (-17%) based on an unchanged 15x FY13 PER. We advocate accumulating on dips, as short-term sentiment will continue to be affected by the poor results and recent CPO price weakness.

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Source: Maybank Research - 25 May 2012