Wilmar (F34.SG) is down 3% at a 6-month low of $5.74 on concerns the group may be losing its focus as it ventures into property development in China with Kerry Properties (0683.HK) and Shangri-la Asia (0069.HK).

OSK, which has a Buy call with a $7.35 target, says while the project in Liaoning’s Yingkou City would be profitable given the expertise of Wilmar’s partners, “this could mark the start of Wilmar’s loss of business focus and corporate discipline.”

Citigroup, which has a Hold call and a $6.76 target, expects Wilmar to bid for more sites in China. “We agree that Wilmar can leverage on its existing contacts and network, but we are not entirely comfortable with the fact that they are expanding beyond the consumer food-related business.”

The companies will jointly develop residential and commercial properties and a hotel in Yingkou. Near-term support is at $5.60 (June 30 low).