KUALA LUMPUR: Shares in SD Guthrie Bhd
rose in early trade Friday after reporting better-than-expected financial results in the second quarter ended June 30 (2Q25).
The plantation group rises 1.89%, or nine sen, to RM4.86 at 10.07 am, gaining more than 2.5% over the past month.
SDG posted a net profit of RM505mil in 2Q25, up from RM415mil in the same quarter last year. It reported revenue of RM5.17bil compared to RM4.97bil in 2Q24.
Over the six-month period, net profit came to RM1.07bil against RM626mil in 1HFY24, while revenue rose to RM9.99bil from RM9.31bil in the year-ago period.
Hong Leong Investment Bank Research (HLIB Research) said SD Guthrie’s 1H25 core net profit of RM1.06 bil, up 69%, exceeded expectations, making up 60.7% to 60.9% of both its and consensus full-year forecasts, driven mainly by stronger-than-expected Papua New Guinea (PNG) operations and lower finance costs.
“We raise our FY25-27 core net profit forecasts by 4.6%/4.3%/6.1%, mainly to account for CPO production cost at PNG operations and lower finance cost assumptions,” the research house said.
HLIB Research has maintained its “buy” rating on SD Guthrie with a higher target price of RM5.37, based on 21 times the revised FY26 core EPS of 25.6 sen.
Meanwhile, RHB Research said SD Guthrie’s 2Q25 core earnings beat expectations, rising 24% year-on-year but easing 8% quarter-on-quarter, with 1H25 core profit making up 62% to 70% of its and consensus’ FY25 forecasts.
The outperformance was driven by lower interest costs, higher-than-expected CPO average selling prices in Malaysia (from forward sales) and PNG, as well as stronger downstream margins.
SD Guthrie declared an interim dividend of 7.8 sen, representing a 50% payout.
RHB has maintained its “buy” call on SD Guthrie, raising its SOP-based target price to RM6.10 from RM5.45 after increasing earnings forecasts by 21.8%, 15.1% and 15.5% for FY25F to FY27F.
The upgrades stem from higher ASP premiums for PNG, lower interest rates, and improved downstream margins. Valuation remains attractive at 19.6 times 2026F P/E, compared with peers’ range of 17 to 22 times.
