Monday, May 16, 2011

Golden Agri-Resources rated 'buy' by Nomura

Stock Name: GoldenAgr
Company Name: GOLDEN AGRI-RESOURCES LTD
Research House: Nomura

Nomura Research in a May 16 research report says: "Golden Agri's 1QFY11 core net profit came in very strong at US$205.7 million, (+152% y-o-y and +102% q-o-q), on a stronger-than-expected CPO production recovery (+35% y-o-y - ahead of peers) and supported by higher realised CPO ASP (+58% y-o-y).

"Cost of production also fell 7% y-o-y due to economies of scale. We roll forward our earnings to FY2013F and raise our FY2011F earnings/price target by 13%/7%, to account for our new estimate of 10% y-o-y FFB production growth in FY2011F, which is still conservative, and has an upside risk in the absence of any unfavourable weather during the year.

"We raise target price to 96 cents (from 90 cents). MAINTAIN BUY."

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