Brokers' take

Wilmar International | Buy Aug 14 close: S$3.25 Target price: S$3.61 DBS Group Research, Aug 14

Wilmar posted a strong Q2 FY18 performance, with earnings ahead of our expectations but in line with consensus. We keep our forecast for now despite the decent earnings performance in Q2 FY18, keeping an eye on US-China trade war development, and China's crushing margin trend.

We forecast core earnings to grow by 6 per cent year-on-year to US$1.09 billion in 2018. Better than expected oil seeds and grains profitability performance in H2 FY18 is the key potential upside risk to our earnings forecast. At the current price, we believe that the market has fully priced in concerns over earnings fluctuation in its tropical oils as well as oil seeds and grains segments, due to lower commodity prices and supply chain congestion.