SINGAPORE (Dec 10): RHB Research is downgrading its recommendation on Bumitama Agri to “neutral” from “buy” with a lowered target price of 60 cents from 80 cents previously.

This came on the back of possible unexciting crude palm oil (CPO) prices in 2019, while downside risks are limited from hereon, as demand is picking up and inventory should start moderating in 1Q19.

In a Monday report, RHB Research analysts say, “CPO prices have surprised us and we believe, the market on the downside, having fallen to a low of MYR1,717/tonne on 21 Nov (from a relatively stable MYR2,000-2,200/tonne for the past 4 months), before recovering slightly to MYR1,800/tonne currently.”

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