Stock Name: Wilmar
Company Name: WILMAR INTERNATIONAL LIMITED
Citigroup said the company’s second half of 2011 was a disappointment as it had weak margin trends at both its oilseeds and palm merchandizing units due to heightened volatility.
Company Name: WILMAR INTERNATIONAL LIMITED
| Research House: Citigroup | Price Call: HOLD | Target Price: 5.30 |
Citigroup reduced its rating on Singapore palm oil firm Wilmar International to hold from buy and cut its target price to $5.30 from $6.10.
Wilmar shares were down 1% at $4.97. The shares are flat so far this year, underperforming a 14 percent rise in the broader market.
Wilmar shares were down 1% at $4.97. The shares are flat so far this year, underperforming a 14 percent rise in the broader market.
Citigroup said the company’s second half of 2011 was a disappointment as it had weak margin trends at both its oilseeds and palm merchandizing units due to heightened volatility.
While market normalization will help Wilmar’s margins recover in these two segments in 2012 fiscal year, the pace of recovery this year will be muted as Wilmar did not record sharply reduced inventory and receivables in the second half of 2011, Citi said in a report.
“While execution on expansion plans in Indonesia may be slow for new entrants, there is now potential that more competitors (both existing and new) may be encouraged to set up facilities.”
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