Monday, July 30, 2012
Wilmar: CIMB Note that Wilmar’s consumer products unit in China may see a margin squeeze following the Chinese government’s “advice” to edible oil producers to refrain from raising cooking oil prices. House estimates that this could drain 3% from the group’s FY12 earnings if edible oil prices trend higher. Believe that the 5% drop in today’s share price has more than accounted for this negative news. However, house retain a Neutral stance and target price basis of 12x CY13 P/E due to the lack of near-term upward rerating catalysts.