PETALING JAYA: Hap Seng Plantations Bhd is heading into the final stretch of the year with analysts forecasting a notably stronger performance, underpinned by surging fresh fruit bunch (FFB) production and an expected easing in operating costs.
Research houses CIMB Research and Hong Leong Investment Bank Research (HLIB Research) both maintained positive views on the Sabah-based planter, with the former expecting the plantation group to post strong results for the fourth quarter of this year (4Q25).
Expectations of bumper crops for the October to December period support CIMB Research’s 4Q25 core net profit projection of RM52mil.
The research house said production momentum had strengthened visibly since mid-year, giving management confidence that its earlier output guidance remains within reach.
HLIB Research noted that Hap Seng’s management remains confident of achieving FFB output target of 680,000 tonnes for this year, despite a weather-related decline in the first 10 months.
According to HLIB Research, the group believes a sustained month-on-month uptrend from July through December will compensate for earlier disruptions.
CIMB Research’’s channel checks reaffirmed the momentum, with October production rising 16% month-on-month to 63,784 tonnes.
“We understand November output is ahead of October,” the research house wrote, adding that peak production is expected in December.
Cost trends are equally encouraging, as both research houses expect a meaningful reversal in Hap Seng’s production costs in 4Q25 after the planter’s production costs had risen to RM2,614 per tonne in the nine months up to September due to higher labour and maintenance spending.
HLIB Research said management projects costs to ease to approximately RM2,000 per tonne in 4Q25, supported by higher seasonal productivity, lower fertiliser requirements, and reduced maintenance work.
The combination of peak production and easing costs is expected to deliver one of Hap Seng’s strongest quarterly earnings for the year. CIMB Research said its 4Q25 core net profit projection of RM52mil is achievable and significantly higher than the RM29mil recorded in 3Q25.
HLIB Research revised its earnings forecasts for this year to 2027 higher, citing adjustments to FFB yields and cost assumptions.
Beyond the near-term earnings rise, Hap Seng is also accelerating estate renewal to ensure future productivity. Both research houses highlighted that replanting will rise to about 1,000ha per year over this year and next.
