First Resources

Uobkayhian on 29 Jan 2014

FY13F PE (x): 13.7
FY14F PE (x): 13.0

2013 results to exceed our expectation. First Resources (FR) is scheduled to release its full-year results on 25 Feb 14. Its 2013 net profit is likely to exceed our expectation on the back of better-than-expected FFB production and higher-than-expected CPO ASP while contribution from downstream is likely to have remained healthy as it switched to biodiesel production to ensure healthy margin amid narrowing refining margin in Indonesia as large new capacities came on-stream in 2H13.

Maintain BUY with target price of S$2.60 based on 15x 2015F EPS of 13.9 US cents. FR remains one of our top picks in the plantation sector for its attractive profile age, cost- efficient estates and hands-on management.