SINGAPORE (May 12): OCBC and CIMB Research are sticking to their “hold” call on Wilmar International with target prices of $3.40 and $3.49 respectively in their reports on Wednesday.

OCBC cites unattractive valuations and challenging 2Q16 conditions among its reasons for the rating. Lead analyst Carey Wong says, “While the recent improvements in CPO prices will benefit its Plantation, Wilmar notes that this will be partially offset by lower margins in its downstream businesses due to higher feedstock costs.”

And although it continues to see healthy growth in its Consumer Products business, Wong says Wilmar warns that crush margins are expected to come under pressure due to an expected flood of soybean arrivals into China in the coming months.

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook