Wilmar (F34.SG) extends its fall, and is down 4% at $5.69 as investors take a dim view of the group’s foray into the property market.

DMG says “while the investment amount of US$134 million ($176 million) is small...and we have no doubt about the eventual profitability of the project...the entry into the property market represents Wilmar’s first ever deviation from its core agribusiness.” House fears this could mark the start of a “loss of business focus and corporate discipline.”

However, DMG maintains its Buy call and says the stock is inexpensive at 13.5x CY11 earnings. Orderbook suggests the downside today is likely to be limited around $5.60, while the group’s solid core should cushion further declines; CLSA says “in spite of our lack of excitement (over the property venture)...Wilmar provides investment exposure to the rising commodity prices and concerns about the impact of China’s price controls have already been reflected (the) share price.”