KPF sold shrs in FGV for dividend payout (10-15%payout every year) to its Cooperative members (employees & ex-employeees of Felda). No need to raise eyebrows over this issue...

CPO production in 4Q16 is 7% lower than 3Q16 but CPO price is RM300 higher. Every RM100 increase in CPO price is translated to an extra RM100 M in profits for large plantation companies like Sime, KLK, Gentings, IOI, FGV, etc.

Shall we all do a crowd funding to break the FGV 1.90 barrier? Need about RM4 M to buy up the 2M shrs that is blocking at 1.89-1.91 price levels

My guess is Kenanga is pressing FGV down hard so as to buy back C16 warrants (Kenanga's highest issue of 150M units in structured call warrants). Issuer has bought back 40M shrs in Jan17 as it now owned 30% at end of Jan compared to end Dec16 of 4% of total listed shares. Maybe, after Kenanga has bought back another 60M of C16 warrants then it will release FGV...
Will it be a proxy fight of Jib vs Taib ?

According to cargo surveyor Societe Generale de Surveillance (SGS), Malaysia’s January 1-20 palm oil exports rose 20.8 percent to 733,002 tons compared to 606,937 tons in the corresponding period last month...

...this is just to say the business is good & getting better, but the people in charge of the business is not good & getting worse...

Every 8 yrs or so, every business needs a revamp of its Management, Structure & Style to keep it growing and alive (just like what's happening in the USA right now).

Ten years ago in 2007, Synergy Drive was a consolidation for 3 plantations - Guthrie, Golden Hope and Sime Darby. The benefit was to reduce overheads from 3 HQ buildings & Staff, 3 R&D centres, 3 boards, and to improve by using one best practice for Plantation Management.

Today in 2017, you need a Synergy Drive II - same argument for rationalisation of resources like only One HQ & Board, One Research & Development Centre and One style of Plantation Management. The rest are just Wastage...

The current CEO of Sime was once CEO of FGV and Tabung Haji and probably is the right person to know what can work and what cannot work in all these companies and also how to connect the dots.......

...from Khor Reports : KL social media reports rumours of China interests to take stake in key Malaysia palm oil plantation companies, citing references in HK Chinese-language media. It would be logical to see greater inclusion of Malaysia GLC corporate interests in China-Malaysia deals (news to be verified).

The possible merger of Sime-FGV-Eagle plantations of total planted area of 1.1 M hectares ?
The largest plantation company in the world ?

Adcool is right that Felda is starting to accumulate...

1.already accumulated RM280M from sale of 35M Maybank shrs,
2.will accumulate another RM500M from sale of hotel at Kensington,
3.going to accumulate another RM1.23B from sale of bal 150M Maybank shrs
4.continue to accumulate another RM400M from sale of 47M shrs Sime Darby
Total cash accumulated RM2.41B. Spend RM10M on Felda social activities.
Bal RM2.4B cash accumulated

Next, announce to Bursa on share buyback,
1. start accumulating FGV 1.3 B shrs at RM1.85 avg
2. Felda now owns 2.64B FGV shr (1.34B+1.3B)
3. Felda start privatisation offer of RM4/shr to buy balance 1 B shr in market
4. Privatisation cost is now RM4 B. or RM4.5 B.(if offer is RM4.50)

Felda settlers & all shareholders will have a happy new year.
Felda is also happy ... no loss as all assets still in place but in different forms.

To be successful in running a listed plantation company, you need to be able to manage the 3 Ps (People, Plants & Profits). If FGV is only strong in one P as it's main focus is on caring for the People and not good enough with Plants and Profits, then stick to the one P.... i.e. Privatise!

FGV should not have been listed in 2012 as it is a social & land development programme for the nation's rural poor. Investors in FGV have a different objective and demand dividends & profit growth every qtr & improving metrics as a listed company. This is clearly a mismatch.

With the joint venture & collaboration with PT Eagle and Indonesia, what 'platform' is Felda going to use to integrate their plantations, research & advisory, if FGV is hopeless in managing plantations?

If you have the option and plan to privatise, what steps would you take?

1. keep FGV price low at 1.70 & below so any offer of + 30% more, it is attractive
2. buy time to dispose of hotels & Maybank/Sime shrs or borrow from S'pore to ready cash
3. park old chairman & board in FGV so it seems hopeless & rudderless (but sack all Directors & Mgrs in FIC responsible for all the bad investments made in the past 4 yrs)
4. let the press know there's no deliberation of privatisation & let the press bash FGV

...but, if you choke on it too long, it is going to die a natural death...

Meanwhile, Felda chairman Tan Sri Shahrir confirmed that it was selling Maybank shares for RM280mil to raise funds to continue programs for its small farmers.

However, Felda denied sale of Maybank shares was linked to the Eagle High acquisition

Bloomberg reported on Tuesday Felda looking to dispose more of its assets and it was also seeking to sell hotel assets in London this year as returns do not justify remaining in that business.

Felda raise cash in Maybank share sale when sale of PT Eagle not yet approved by Gov't of MY and Indon? If sale not approved, use cash to privatise ?
http://www.thestar.com.my/business/business-news/2017/01/17/felda-seeks-to-raise-cash-via-maybank-share-sale/

The Chairman of Felda said No decision Yet on FGV Listing.... will let Chairman of FGV know later if it's on or not...
http://www.freemalaysiatoday.com/category/nation/2017/01/16/shahrir-no-decision-yet-on-fgv-delisting/

That was ITS CPO exports estimate.

According to cargo surveyor Societe Generale de Surveillance (SGS), Malaysia’s January 1-15 palm oil exports rose 12 percent to 520,332 tons compared to 464,582 tons in the corresponding period last month.

Just like all the Analysts' forecast for the FGV's target price...is it 1.77 or 3.54....

Palm Oil Exports Malaysia :
With the increase of 6.7% as of 15 Jan this year, if sustained, this rise suggests a 'bullish tone' in the near term... this is 'extremely rare' for Malaysia's January palm oil exports to exceed those of the preceding month.............

KWAP Chairman meant Enterprise Value not Net Tangible Asset when he says value of asset....
The EV of FGV is RM 16.78 B (by Gurufocus) and total listed FGV shares 3.648 B....
so EV per shr is RM 4.60

The present NTA is not reflective of fair value as these accounting standards IAS16 (for bearer palms) and IAS41 (for Agri produce) have not been measured or quantified and disclosed...
so it is more than RM 4.60

Felda itself is planning a series of roadshows to convince settlers in its plantation areas of the PT Eagle deal's benefits and the New Restructuring Plans for 2017. This to counter Rafizi's claims and the Edge bashing of Felda... The counterstrike has started...

FGV may consider selling Asian Plantations PLC and Pontian Plantations Bhd to Sime Darby, even at the same prices that it bought. These 2 units have a better fit with Sime rather than under FGV.

Higher exports and lower inventory for CPO this January will set the stage for price uptrend. For plantations, when product prices are up... all the problems will disappear...
Don't analyse so much,,,, just hold on to your FGV

Jan 10, 04:37 : According to cargo surveyor Societe Generale de Surveillance (SGS), Malaysia’s January 1-10 palm oil exports rose 10.7 percent to 338,777 tons compared to 305,990 tons in the corresponding period last month.

Look at CPO prices in last El Nino 1997/98 when CPO jumped up 30% in Jan1998, I expect similar occurrence in Jan or Feb 2017 (after El Nino 2016) for CPO price to jump to RM 3500 pmt... once India got its cash notes sorted out...

CPOPC secretariat start operations in March. PT Eagle is a done deal.

Its first assignment is how to counter anti-palm oil lobby by Europe, especially France. France has 500 euros import tax on palm oil wef 2017 increasing by 100 euros each year until 900 euros.

So, forget about exports to Europe. Now we sell to China, India & Middle East.
We will buy our steel from China for our new railways and pay for it with palm oil.
We know how to grow oil palm and China knows how to make steel cheap ....
.. so sell your steel mill shrs and buy more plantation shrs...

Oil Palm Plantation is the only business where Malaysia is World Class...

CPOPC

No need to abort PT Eagle acquisition by Felda. Like in a 'Trump' deal, PT Eagle will reciprocate by buying 500M shrs of FGV at RM4.44 = USD 505M.
This can then a sensible JV & merger and enhances CPOPO (Collaboration of Palm Oil Producing Countries)....

The reason you replant is when the crop from your old palms cannot give you your target margins e.g. 20%. If the prices are high, even at 15 ton FFB per hectare is still good earnings. In W Africa, they only average 12 ton.

In a strategic plantation business, you should replant 'less' when the palm oil price is good (maximising profits in mature palms) and replant 'more' when the palm oil price is poor (because margins are low). Generate the cash now while the CPO price is >RM3000 and then accelerate your replanting in later years.

When prices are average, then you replant average 4% a year if you're going to fell the palms at 25 yrs old. These days, with technology and long aluminium alloy poles, the harvesters can harvest the palms to 30 yrs old.

So, don't push for replanting now while you generate good cash with high margins

Like MAS in Aug2014, if you need to do a quick, corrective & intensive surgery on FGV (on Directors, Mgt & restructuring, etc.) you need to delist and take it private else you would be burdened with shareholders' meetings, approvals, etc. The new Chairman of Felda is on the right track as next in mind he needs to integrate the operations of FGV and PT Eagle after the purchase to derive the synergy.

So, like MAS in 2014, prepare for the delisting offer (likely in Feb or Mar 2017) of 29% above the ave prices of past 3 months (i.e. Nov RM2.00, Dec RM1.65 & Jan RM1.75 = Ave RM1.80).

1st offer price should be RM2.32
Pls do not accept yet (Singapore Airlines offered 30% above current price to take Tiger Air private and later on, a 2nd offer of additional 10% to get the target 90% shareholding.

If we stick together, we shall wait for 2nd offer of RM2.55

AdCool. I know...I'm returning the bashing. I'm just wondering why they are still on it... is it becos the Edge Weekly was suspended or Malaysia Insider was closed down? Or is it their syndicate are playing the market?
My guess is that it is still about the Money... just like in the movie 'Die Hard' .

This week, the Edge is still chewing at Felda-FGV, especially at PT Eagle High on its NDPE policy (No deforestation, Peat & Exploitation).
This time is to quote and reproduce articles from NGO's reports on forest burning and orang utans driven off as PT Eagle expanded its plantations. You can see in the Edge the picture of orang utans was poorly doctored. It was actually a pic of feeding time of orang utans in a sanctuary that was made hazy to look like the burning forest was chasing them away. (You can see in the pic background of the man feeding the orang utans. There are green shoots here and there amongst the 'breathing roots' of forest trees. This is not a charred wasteland as mentioned). These guys have never been to a real jungle to know about exposed roots and burned wasteland. Sad.

The Edge is on dangerous territory here if it continues to take fake pictures from NGO's articles.

Is the Edge on an anti-oil palm lobby or an anti-Malaysia lobby? I hope some clear heads will prevail...

Shahrir Abdul Samad as the new Chairman of Felda is a very good move.... now you do not need a Steering Committee for Felda or FGV... also Isa in now canned or parked in the freezer.
We can expect smart & rational decisions from Shahrir as he was from the Econs Fac of MU of the late 60's and has a Swiss MBA from Lausanne as compared to Isa's MBWA (Management By Walkin' Around)...

On insurance clain by FGV of RM 59M:
Plantations can claim insurance against floods, fraud, theft, pilferages, etc. Pilferage of palm fruits & oil is very common in all plantations. Drivers of oil tankers pilfer palm oil by adding water to make up the load wt. Sometimes the staff stole the whole tanker of oil by faking goods received notes. It could be in the case of Felda Iffco in Turkey, no one was aware when some staff & Mgrs diverted ten 20-tonne tankers each mth elsewhere. After a year then they found missing 2000mt x 12 mths x RM2458/mt=RM 59M....
Now that CEO Zak has made a statement that the worst is over for FGV, we can now take up an insurance against his assurance.... so that we can a claim later in 2018.

http://www.thesundaily.my/news/2115302?platform=hootsuite

If you have read this news on the insurance claim made by FGV on the Turkey Iffco fraud case... this confirmed that the fraud loss is limited to RM59M. On Nov26,2016 issue, the Edge Weekly has bashed FGV on the impairment loss up of to 300M...simply causing retail investors to lose money on unsubstantiated news reporting (and also using Radio BFM to add more fuel to the fire). The Edge Daily distributes freely and easily to Malaysian readers for some purpose...

Just be careful, the News Syndicates (The Edge, The Star & some PKR are in cahoots) to pepper you with silent persuasion to rattle your investment decisions..

With coming GE14, I'm not voting for PKR or Jib gang, maybe pick an Independent with Integrity......I know they're are very rare

Why Kenanga add another 50M shrs to FGV-C16 on Dec20, 2016 instead of doing a new listing like C-23 or something. Something fishy going on ?

If you think you can buy plantation land planted with oil palms cheaper than USD16k per hectare, try n buy 37% of Kretam or RSawit at current share prices....

I am not sure these events are related should be investigated any connections whether there are speculators’ intent to manipulate the market.

 

On 26 Nov 2016, I read in the Edge Weekly that FGV has to make another 300M impairment loss... this has caused the FGV C-16 warrants to tank down >30% on Monday open (28Nov) and Kenanga Warrants sold most to hold only 5% at end of Nov 2016.

(FGV later clarified to say the RM200 million to RM300 million potential adjustments were related to the management’s plan to improve the group’s future income by undertaking a rationalisation plan for some of its assets. The FGV counters then recovered from its low)

Kenanga then made another new issue of 50M warrants listed on 20 Dec 2016 saying Bursa request liquidity in its warrants. As I see, there are sufficient liquidity with 100M.

Three days later, on 23 Dec 2016, The Edge Daily reported that EPF do not have any more holdings in FGV and again cause the FGV C-16 warrants to tank down 36% because of its implication that FGV is bad investment.
(FGV CEO later clarified and urging our stakeholders and the public at large to refer their questions directly to our respective organizations and not to be misled by social media and unsubstantiated online sources). .From annual reports,as shareholders we already know that EPF have been reducing its stake after IPO... end 2013(6%), end 2014(5%), end 2015(3%) & end 2016(0%). Why the damning news.

So, I am wondering whether there is any connections between people who report news and use of warrants to short the market.

Perhaps Bursa or SC need to start implementing heavy fines & penalties for those who manipulate the market and its derivatives like what the SEC do in US for market manipulation

MP Evans reject KLK new offer- US$14,100 per hectare

In an announcement to London’s Alternative Investment Market on Monday, it said Khong & Jaafar, a Malaysian firm that specialises in the valuation of oil palm estates and property. valued the group’s land assets at US$665mil (RM2.97bil), “which implies an equity value of £10.82 (RM60.25) per share.”

US$665M also cannot buy 32,000 hectares of plantings.

To buy plantation land cheap, go to West Africa e.g. Liberia, etc. For the next 20 yrs, it will be a non-starter (ask Sime, KLK, Wilmar, Feronia, etc)

To grow oil palms (for above 5 tons oil/hectare yield)... these are the only countries ... Malaysia, Indonesia and Papua,,,

Some positive pointers on Plantations :
Felda-Eagle deal will boost the cooperation of 2 largest palm oil producing countries (CPOPC Agenda). PT Eagle was formed in the takeover of Golden Eagle Holdings by BW Plantations to form the 3rd largest plantation group listed on IDX in 2014. Majority shareholders of BW Plantations are Rajawali Group (P.Sondakh) and the Widodo family (Jokowi). The President(Indo) and the PM(MY) have agreed that this tie would be good for the countries of Malaysia & Indonesia for the future of palm oil. This JV is a win-win. Felda have old palms & Eagle has very young palms (ave 6 yrs). Felda has the refineries & markets (13 countries) & Eagle has the land & workers for growth for next 20 yrs.... why stop this deal?

Higher CPO prices like what it is now (RM 3100 pmt) normally make the problems disappear, especially for plantation companies .... don't worry about the small issues ... a good CEO is what you need

Analysts usually make depressing assumptions ... like this one....

KUALA LUMPUR (Feb 11,2016): BIMB Securities Research has maintained its “Neutral” rating on the plantation sector and kept its crude palm oil (CPO) price assumptions of RM2,300/MT for 2016 (1H2016: RM2,200/MT – RM2,500/MT; 2H2016: RM2,100/MT – RM2,400/MT) and said it believes the discount gap to soybean oil will continue to narrow hence the slowing demand from major importing countries.
In a note today, the research house said macro issue by uncertainty of the world economy and low crude oil prices, may have resulted in heightened volatility in the commodity market and hence, going to dampen demand especially from China, EU and US.
“Maintain Hold on IOI Corporation Bhd (TP: RM4.25), Kuala Lumpur Kepong Bhd (TP: RM21.04), Batu Kawan Bhd (TP: RM17.80) and TSH Resources Bhd (TP: RM1.95).
“Due to recent price run-up, we have a Sell on IJM Plantations Bhd (TP: RM3.20), Genting Plantations Bhd (TP: RM9.60), Felda Global Ventures Holdings Bhd (TP: RM1.31) and Hap Seng Consolidated Bhd (TP: RM2.06) while a non-rated for TH Plantations Bhd (TP: RM1.17),” it said.

Inserted from <http://www.theedgemarkets.com/my/article/bimb-securities-keeps-cpo-price-assumption-rm2300-2016>

In FGV, it is more about reducing the losses rather than trying to match the crop yields of UP or IOI. They have losses in Felda Iffco & other subsidiaries, losses in palm products on transit as well as in storage, and more losses in the field (for not harvesting frequently each month i.e. 3 x).
They supervise, they check, they look around but they don't see... not easy to see unless you know how.

CEO can say '... money is made with your feet (or feat) and that his new mantra is " What I expect, you can inspect " ... can it be done in Felda and to smallholders ?
I reckon, one way to start is to displace all those managers with waistline above 40 inch. If they have been walking, they wouldn't have such waistlines. Imagine them not walking when they are paid to walk, so severance is the consequence.

FGV need to just begin 2017 by reducing their losses listed above then maybe can improve CPO production by 20% (recovery from the wastage) + another 15% higher crop in 2017 (after-effect year of 2015/16 El Nino) + another 15% CPO price increase (to RM3500 by Feb)... then we can smile our way to the bank

From Fri's closing price to Today's price, CPO has inched up another 100 Ringgit to RM3182pmt.
Every RM100 increase in CPO price will add RM 150M to FGV's revenue...

Feb futures CPO closed at RM 2869 today...
any fool plantation company should be making profits at these prices

Icon, I like your focus on future earnings of stock that you want to buy in 2017.
What are about plantation stocks (e.g. FGV, Sime, etc) as CPO prices are rising and next year is a bumper crop after a drought year. Earnings are in USD (CPO prices correlated with USDMYR) and labour wages and some costs are in Ringgit.

Airasia may not be a good bet now as it is no longer a low cost carrier. Where got low cost when there are no low cost terminals in Malaysia? Where's the competitive edge?

17 Nov 2016 : Indonesia based Golden Agri Resources (GAR) reported 37% increase in CPO production to 501,000 tonnes in the 3rd quarter of its financial year (FY) covering Jul-Aug-Sept compared to the second quarter FY which recorded 367,000 tonnes....
If Indonesia can do it, so can Malaysia....

BMD CPO price still firm
Dec +161 3056 - 1683 lots
Jan +160 3054 - 11210 lots
Feb +162 3043 - 4890 lots
Mar +164 3032 - 2645 lots

FGV's CPO production in 2Q16 total 658,000mt and in 3Q16 total 782,000mt...
Do your Math...

Every RM100 increase in CPO prices will add RM150M to FGV's Revenue...
CPO price RM2500 in July 2016 and CPO price RM2800 in Nov 2016 ..
Do your Math...

you guys got Analysis Paralysis...
The story has changed... from "Now Everyone Can Fly ... Extra Long"
... to "Now Everyone Can Flee,,, Extra Fast"

MAS, TigerAir, NokScoot & Virgin Australia are now out of their coma and recovering.
With the low fuel prices, there are now more airlines and more aircrafts in the air ......
but just not enough passengers to fill the plane !

Tigerair Australia benefits from Indonesia AirAsia X withdrawal from Australia....
AirAsia’s share is dropping to 16% at the end of Aug-2016, when Indonesia AirAsia X pulls out of the Bali to Melbourne and Sydney markets. Indonesia AirAsia will continue to operate from Bali to Darwin and Perth.

See related report: Lion Group and Turkish Airlines could fill the void in Australia-Bali market as AirAsia X withdraws...

If you know each qtr and next qtr's business is getting challenging with 17 LCCs in SE Asia and 23 LCCs in NE Asia operating, you should withdraw too...

all Red lights from now.... 2Q16 Revenue, passengers carried & load factor all lower than last qtr ....tough going next 6 months and challenging biz environment... also no Forex gain expected in 2Q and 3Q....better pull out now and try the next round