SINGAPORE (Nov 16): OCBC is maintaining its “hold” call on Olam with an unchanged fair value of $1.86 cents given that its 3Q results came in below expectation and its near-term outlook remains muted.

Olam’s 3Q15 revenue was up 4% at $4.5 billion, with all segments registering growth except its Food Staples & Packaged Foods segment, which faced lower volumes, prices and continued underperformance of its upstream Dairy operations.

EBITDA margin nearly halved to 2.3% from 4.9% a year ago, due to reduced trading volumes and as Dairy operations continued to underperform as Olam is restructuring the dairy farming business in Uruguay and it expects to book a one-time restructuring cost in 4Q.

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