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Broker's Take: CIMB keeps 'hold' call on Golden Agri-Resources, 'overweight' call on Reits

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CIMB Research has kept its "hold" call on Golden Agri-Resources as "the stock is fairly valued at the current level".

CIMB Research has kept its "hold" call on Golden Agri-Resources as "the stock is fairly valued at the current level".

It said there was keen investor interest in the world's second largest palm oil plantation company recently.

But questions about the group's recent oilseeds losses and poor returns from its recently-expanded downstream operations remain.

Golden Agri-Resources has said that the oilseeds loss is likely to be one-off as it is taking action to improve the unit's performance.

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CIMB said it is keeping its earnings forecasts, target price of S$0.50 and "hold" call.

Still, it prefers First Resources in the plantations space.

As at 9.15am, Golden Agri-Resources' counter stood at S$0.455, while First Resources rose three Singapore cents to S$2.04.

Separately, the research house said dynamics continue to improve in Singapore's Reits. It said Singapore's hospitality market has displayed signs of turning around in the second half of 2014, a trend CIMB believes will continue in 2015.

"With more upcoming key events and attractions, we remain confident that Singapore hotels could end the year with a stronger revenue per available room (RevPAR). We also maintain our bullish view on the hospitality market in 2015. Given the expected 2-4 per cent rise in visitor arrivals in 2015 and potentially longer stays, we expect total visitor days (TVD) to climb in 2015 and meet the upcoming 4 per cent supply of hotel rooms."

CIMB has maintained "overweight" on the sector, with CDL Hospitality Trusts and OUE Hospitality Trust as its preferred picks.

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