PETALING JAYA: Kenanga Research has upgraded its call for United Malacca Bhd
to “outperform” from “market perform”, based on the steady performance of its Indonesian operations.
In a note, the research firm said the Indonesian operations’ fresh fruit bunch (FFB) output had grown 69% year-on-year (y-o-y) due to an expansion in matured areas as well as a 52% jump in FFB yield as its Kalimantan estates grew into a more productive age profile.
In its third quarter ending Jan 31, 2024 (3Q24), the group registered a net profit of RM19.3mil, an increase of 19% quarter-on-quarter (q-o-q) as earnings before interest and tax margin improved 16% to 20% due to continual improvement in its Indonesian harvest.
Kenanga Research said despite the second quarter being the most profitable for the group, a 10% q-o-q uptick in FFB output from Indonesia offset the weaker Malaysian harvest, thus easing unit costs and lifted margins.
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