/// East Malaysia Property News
Property Potential to Perk Up Valuations for Local
Planters
Kota Kinabalu No. 6 on
TripAdvisor’s Asia List
underweight view on the
sector.
“Singapore fund managers
were surprised to learn
that the valuations of
plantation stocks in Malaysia
are relatively higher than
regional peers in part due to
the growing pool of syariah
funds in Malaysia,” Ong
observed.
Certain plantation entities
in Malaysia will see their
valuations lifted by property
development potential, says
an analyst with Maybank
Investment Bank Bhd
(Maybank Research).
Analyst Ong Chee Ting in a
report on the sector noted
that unlike Indonesian
planters, selected Malaysian
plantation stocks have a
property angle to them.
“Some of these plantation
land, mainly those located
in Peninsular Malaysia, have
been held for more than
20 years and are prime for
property development,” the
analyst highlighted.
“For example, Genting
Plantations Bhd, KL Kepong
Bhd, and Sime Darby have
strategic landbanks in the
Klang Valley and Iskandar
Malaysia (Johor) which
are prime for property
development.
“In Miri (Sarawak), Sarawak
Oil Palms Bhd (Sarawak Oil
Palms) is about to embark
on a new journey into
property development
to unlock the value of its
pla ntation estates..
Ong further pegged
companies with young tree
age profiles to grow the
fastest and outperform their
peers in the long run.
“In this space, Indonesian
player Bumitama Agri leads
the pack with its young
tree age profile of about
62
5.5 years old, followed by
Sarawakian player Ta Ann
Holdings Bhd (about six
years), TSH Resources Bhd
(about seven years), Sarawak
Oil Palms (about 8.5 years),
and TH Plantations Bhd
(about nine years).
On Maybank Research’s top
buys in the region, the firm
pegged First Resources,
Bumitama Agri, TSH
Resources, Ta Ann and Felda
Global.
“We prefer small- to midcap plantation plays for
this year’s first quarter
on significant earnings
turnaround leveraging
on higher crude palm oil
average selling prices year
on year and their relatively
cheaper valuations vis-à-vis
large caps,” Ong explained.
“Companies with good longterm growth proposition
given their younger age tree
profiles like First Resources,
Bumitama Agri, TSH
Reosurces and Ta Ann are
our top picks.
“For large caps, Felda Global
is a trading buy, for we
expect it to post a significant
turnaround in core earnings
given its relatively higher
cost base and for mergers
and acquisition potential.”
Meanwhile, on the firm’s
recent visit to Singaporean
funds, Maybank Research
gathered that most
have little exposure to
the plantation sector,
and largely neutral to
www.PropertyHunter.com.my
Syariah funds are prohibited
from buying conventional
banking and sin stocks (like
gaming and alcohol) which
preclude about 40 per cent
investable stocks on the
FBM KLCI.
“The growing pool of
syariah funds has in turn
benefited the largely syariah
compliant plantation,
tele-communication, and
oil & gas stocks which also
explains their relatively
higher valuations vis-a-vis
regional peers.
“Hence, while Malaysian
plantation stocks are
relatively more expensive
than regional peers, we
believe its valuations will
remain rich going forward as
the growing pool of syariah
funds in recent years are
structural in nature.”
Kota Kinabalu managed
to snag the sixth spot
on the 2013 Asia List,
based on the reviews
and opinions of millions
of TripAdvisor travellers,
TripAdvisor announced
recently.
The world’s largest travel
site named the winners
of its 2013 Travellers’
Choice Awards for
Destinations on the Rise.
The awards highlight
54 spots globally that
have seen the greatest
increase in positive
traveller feedback and
traveller interest, yearover-year.
Havana, Cuba, was the
number one ranked
destination for the top
10 in the world, and
lists were also revealed
for Asia, South Pacific,
Europe, South America,
and the United States.
Kota Kinabalu in Sabah,
ranked sixth in Asia,
is the only Malaysian
destination included in
the Asia list.
“For travellers looking
for inspiration for their
2014 travel planning,
TripAdvisor travellers
have helped us put a
spotlight some amazing
destinations that caught
the eye of travellers this
past year,” said Barbara
Messing, chief marketing
officer for TripAdvisor.
“Between large cities
gathering steam and
off-the-beaten-path
spots surfaced by our
community, travellers
can discover wonderful
accommodations,
attractions and
restaurants in all of
these award-winning
destinations.”
Top 10 Destinations on
the Rise in Asia:
1.
2.
3.
4.
Kathmandu, Nepal
Sapporo, Japan
Hanoi, Vietnam
Siem Reap,
Cambodia
5. Hua Hin, Thailand
6. Kota Kinabalu,
Malaysia
7. Sanur, Indonesia
8. Macau, China
9. Jaipur, India
10. Busan, South Korea
Top 10 Destinations on
the Rise in the World:
1.
2.
1. Havana, Cuba
La Fortuna de San
Carlos, Costa Rica
3. Kathmandu, Nepal
4. Jerusalem, Israel
5. Cusco, Peru
6. Ambergris Caye,
Belize
7. Sapporo, Japan
8. Hanoi, Vietnam
9. Corralejo, Spain
10. Fortaleza, Brazil