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UOB Kay Hian maintains Wilmar's TP at $6 ahead of FY2021 earnings

Felicia Tan
Felicia Tan1/20/2022 6:19 PM GMT+08  • 4 min read
UOB Kay Hian maintains Wilmar's TP at $6 ahead of FY2021 earnings
The counter’s share price performance remains lacklustre due to the concerns over China’s weak economy and Covid-19 restrictions
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UOB Kay Hian analysts Leow Huey Chuen and Jacquelyn Yow have kept “buy” on Wilmar International ahead of the agri-giant’s results for the 2HFY2021 and FY2021 ended Dec 31, 2021, with a target price maintained at $6.

For the 4QFY2021, Leow and Yow say they estimate Wilmar to report a core net profit of US$380 million to US$400 million ($512.5 million to $539.5 million), driven by strong performances from Wilmar’s palm and sugar operations, offsetting the weaker contribution from China.

“The plantation and sugar milling division, which is the upstream operation for Wilmar, is expected to see significant earnings increase y-o-y and h-o-h in 2HFY2022,” write the analysts in a Jan 19 report. The analysts have also noted that while the division contributed about 13% of Wilmar’s 1HFY2021 profit before tax (PBT), it is expected to increase to 22%-25% of 2HFY2021 PBT on the back of strong selling prices.

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