Brokers' take

Bumitama Agri | Buy Target price: S$0.98 June 11 close: S$0.675 Maybank Kim Eng, June 8

Following the lower-than-expected CPO (crude palm oil) spot ASP achieved year-to-date (Jan-May) of RM2,442 per tonne in Malaysia and muted near-term price outlook amid still ample palm oil stockpile, we now cut our 2018 industry-wide CPO ASP forecast to RM2,450 per tonne (-6 per cent).

We also lower 2019-20 forecasts to RM2,500 per tonne (-4 per cent) and RM2,600 per tonne (-2 per cent). But given the recent weakness in Indonesian rupiah against ringgit and the US dollar, our 2018-2020 CPO ASP forecasts in rupiah were raised to 8,560 rupiah per kg (+4 per cent), 8,735 rupiah per kg (+7 per cent), 9,084 rupiah per kg (+9 per cent).