OCBC downgrades Golden Agri-Resources (E5H.SG) to Hold from Buy, given limited upside, keeps $0.78 fair value, according to Dow Jones.

OCBC says CPO price rally, strong 21% on quarter recovery in CPO output boosted 3Q10 results; also notes company maintains positive CPO outlook, citing growing consumption of edible oils, fats, particularly by bulging middle classes in China, India, Pakistan.

Adds however, “management does not expect any increase in production this year (vs +5% previously), attributing the shortfall to the heavy rainfall over the past few months.”

Says GAR’s plan to add more refining capacity to support domestic sales “a sound move as domestic sales do not attract potentially exorbitant export taxes.”

Raises FY10, FY11 revenue forecast by 13.4%, 12.6%, respectively, cuts FY10 earnings estimate by 5.5% on lower margin assumptions, ups FY11 earnings by 1.2%. Shares last flat at $0.760.