Plantation - Peak Production Period To Start Soon - 13/7/2010

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Page 1 of 8

13 July 2010

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Recom : Neutral

(Maintained)

Table 1 : Plant ation Sector Valuation s

FYE Price

FairValue

EPS *(sen)

EPS growth(% )

PER(x )

P/NTA(x )

P/CF(x )

GDY(% ) Rec

(RM/ s) (RM/ s) FY10 FY11 FY10 FY11 FY10 FY11 FY10 FY10 FY10

KLK Sep 16.48 20.55 87.4 123.1 23.5 40.8 18.8 13.4 3.0 15.1 2.7 OP

IOI Corp Jun 5.09 6.65 26.8 33.1 -16.3 23.3 19.0 15.4 3.7 16.6 2.4 OP

CBIP Dec 2.71 3.70 41.2 49.7 37.5 20.6 6.6 5.4 1.3 5.2 5.2 OP

First Resources Dec 1.08 1.35 7.9 9.5 +>100 19.9 9.8 8.2 1.8 9.7 2.3 OP

IJMP^ Mar 2.40 2.30 13.5 14.6 20.5 8.2 17.7 16.4 1.7 14.0 2.3 UP

Gent Plantation Dec 6.85 6.50 40.2 45.0 29.3 11.9 17.0 15.2 1.9 15.3 1.6 UP

Sime Darby Jun 7.73 8.15 39.7 48.0 5.9 20.9 19.4 16.1 2.2 13.7 2.8 UP

Sector Avg 0.3 24.2 18.9 15.2

^ FY10-11 valuations refer to those of FY11-12 *Normalised

♦ Higher production and exports, but lower stocks. Malaysia’s CPO

production rose in June 10 by a minimal 2.5% mom, while exports rose by

a larger 5.5% mom. As a result of the larger rise in exports versus

production, closing CPO stock levels fell to 1.45m tonnes in June (from

1.56m tonnes in May) and stock/usage ratio fell further to 7.8% (from

8.5% in May and versus the 7-year average of 9.1%). However, going

forward, notwithstanding any effects of adverse weather, we expect this to

potentially start reversing from next month onwards, as it approaches the

peak seasonal production period.

♦ Three short-term negative and long-term positive developments.

We noted a few main developments in the sector in the form of three longterm positives and three short-term negatives. Long-term positives are:

(1) a continued decline in stock/usage ratios for the 8 vegetable oils

expected in 2011; (2) an increase in the biodiesel mandate in Argentina for

4Q2010 and 2011; and (3) a continuation of La Niña temperatures which

could have a longer-term impact on production. Short-term negatives are:

(1) the possibility of a reduction of Argentine export tax; (2) the USDA

planting data report – which showed increased soybean acreage; and (3)

the reduction in competitiveness of CPO vs soyoil.

♦ Risks: (1) a significant change in crude oil price trend; (2) weather

abnormalities; (3) change in emphasis on implementing global biofuel

mandates and trans-fat policies; (4) significant changes in trade policies of

vegetable oil importing or exporting countries; and (5) a sharper-than-expected global economic slowdown.

♦ Forecasts. No change to our forecasts.

♦ Investment Case. We are maintaining our Neutral recommendation on

the plantation sector, as we believe there are not many positive catalysts

which would move CPO prices up in the near term, and therefore expect

plantation companies’ share prices to remain lacklustre until this scenario

changes. Despite this, we continue to have Outperform recommendations

on some stocks within the sector including SGX-listed First Resources (FV

= S$1.35), KLK (FV = RM20.55), IOIC (FV = RM6.65) and CBIP (FV =

RM3.70), while we maintain our Underperform recommendations on Sime

Darby (FV = RM8.15), Genting Plantation (FV = RM6.50) and IJMP (FV =

RM2.30).

Corporate H igh l ights

Sec to r Upda te

PlantationPeak Production Period To Start Soon

Chart 1. CPO vs soyo il and rapeseed

oil prices

100

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90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10

US$/tonneCPO Soy O il RapeseedOil

Chart 2. CPO vs crude oil prices

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o i l p r i c e s

( U S $ / b a r r e l )

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C P

O

s p o t p r i c e s

( U S

$ / t o n n e )

C ru de O il ( US $/ ba rr el ) C PO ( US $/ to nn e )

Correlation factor of

0.9x in 2007

narrowed to 0.75x in

1H08, and rose again

to 0.95x in 2H08.Correlation factor started

normalising to 0.7x from Dec-

08, but rose again from Sep-

09 onwards to close to 1x,

before falling back to around

0.7x currently.

Hoe Lee Leng(603) 92802184

[email protected]

13 July 2010

RHB ResearchInstitute Sdn BhdA member of theRHB Banking GroupCompany No: 233327 -M

M a l a s i a

M A

R K E T

D A T E L I N E

P P

7 7 6 7 / 0 9 / 2 0 1 0 ( 0 2 5 3 5 4 )

Please read important disclosures at the end of this report.



Page 2 of 8

13 July 2010


Monthly Statistics

♦ Production rising, but exports rising higher... Malaysia’s CPO production rose in June 10 by a minimal 2.5%

mom to 1.42m tonnes, while exports rose by a larger 5.5% mom to 1.44m tonnes. On a yoy basis, production

was slightly lower, falling 1.8% yoy, but exports rose by a higher 12.6% yoy. As a result of the larger rise in

exports versus production, closing CPO stock levels fell to 1.45m tonnes in June (from 1.56m tonnes in May).

Most notably, the mom increase in exports was to China (+13.8%), India (+54.3%), Egypt (+75.3%), Pakistan

(+21.1%), Ukraine (+20.3%) and the EU (+22.8%); offset by a decrease to Benin (-50.4%), Iran (-22.3%), UAE

(-25.8%) and the US (-57.9%).

♦ … stock/usage ratio fell back further. As a result of the lower CPO stock levels, stock/usage ratio fell further

to 7.8% (from 8.5% in May and versus the 7-year average of 9.1%). However, going forward, notwithstanding

any effects of adverse weather, we expect this to potentially start reversing from next month onwards, as it

approaches the peak seasonal production period.

Table 2: Monthly CPO Statistics

('000

tonnes)

Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10

Opening

stocks 1,408.3 1,332.2 1,416.4 1,579.3 1,974.5 1,934.6 2,239.3 2,003.2 1,789.2 1,655.7 1,622.6 1,562.3

Imports 82.4 84.9 109.9 73.3 47.4 153.8 139.4 50.5 35.4 105.3 110.6 60.3Productn 1,492.2 1,496.1 1,557.8 1,984.0 1,595.6 1,520.1 1,321.0 1,156.8 1,387.2 1,306.2 1,385.4 1,420.1

Totalsupply 2,982.9 2,913.1 3,084.2 3,636.6 3,617.5 3,608.5 3,699.7 3,210.5 3,211.8 3,067.3 3,118.6 3,042.7

Exports 1,454.5 1,317.6 1,322.9 1,478.5 1,501.5 1,224.4 1,461.7 1,294.9 1,396.9 1,285.5 1,365.6 1,440.9Domestic

use 196.2 179.1 182.0 183.6 181.4 144.9 237.3 126.3 159.1 159.3 190.7 150.4Total

offtake 1,650.7 1,496.7 1,504.9 1,662.1 1,682.9 1,369.2 1,699.0 1,421.3 1,556.1 1,444.7 1,556.3 1,591.3End mthstocks 1,332.2 1,416.4 1,579.3 1,974.5 1,934.6 2,239.3 2,000.7 1,789.2 1,655.7 1,622.6 1,562.3 1,451.4

ProductnYTD 9,412.9 10,909.0 12,466.7 14,450.8 16,046.3 17,566.4 1,321.3 2,478.1 3,865.4 5,171.6 6,557.0 7,977.1Mom (%) 3.2 0.3 4.1 27.4 (19.6) (4.7) (13.1) (12.4) 19.9 (5.8) 6.1 2.5

YoY (%) (4.4) (6.5) (1.4) 20.1 (3.8) 2.5 (0.7) (2.6) 8.7 1.6 (0.7) (1.8)YTD (%) (3.6) (4.0) (3.7) (1.0) (1.3) (1.0) (0.7) (1.6) 1.9 1.8 1.3 0.7

ExportsYTD 9,030.2 10,347.8 11,670.7 13,149.2 14,650.7 15,875.0 1,461.7 2,756.6 4,153.6 5,439.1 6,804.7 8,245.6Mom (%) 13.7 (9.4) 0.4 11.8 1.6 (18.5) 19.4 (11.4) 7.9 (8.0) 6.2 5.5

YoY (%) 3.7 (10.2) 2.0 10.7 10.2 (24.2) 8.0 3.0 10.8 7.7 11.0 12.6YTD (%) 8.4 5.6 5.2 5.8 6.2 3.0 8.0 5.6 7.3 7.4 8.1 8.8

Stocks

Mom (%) (5.4) 6.3 11.5 25.0 (2.0) 15.7 (10.5) (10.7) (7.5) (2.0) (3.7) (7.1)YoY (%) (32.6) (23.4) (19.1) (5.6) (14.6) 12.3 9.3 14.3 21.2 25.5 13.9 3.1

Source: MPOB, RHBRI



Page 3 of 8

13 July 2010


Recent Developments

♦ Three short-term negative and long-term positive developments. We noted a few main developments in

the sector in the form of three long-term positives and three short-term negatives. Long-term positives are: (1) a

continued decline in stock/usage ratios for the 8 vegetable oils expected in 2011; (2) an increase in the biodiesel

mandate in Argentina for 4Q2010 and 2011; and (3) a continuation of La Niña temperatures which could have a

longer-term impact on production. Short-term negatives are: (1) the possibility of a reduction of Argentine export

tax; (2) the USDA planting data report – which showed increased soybean acreage; and (3) the reduction incompetitiveness of CPO vs soyoil.

♦ Long-term positives in the form of a continued decline in stock/ usage ratio for 2011 for 8 o ils;... Oil

World has released its latest estimates for Oct/Sept 2010/2011, which continues to see a decline in stock/usage

ratio of the 8 global vegetable oils to 10.6% in Oct 2011 (from 10.9% in 2010), on the back of a 4.4% yoy

growth in production and a 4.1% yoy growth in consumption. The growth in production is mainly expected to

come from palm oil (+5.6% yoy) and soybean oil (+7.1% yoy), although this is offset somewhat by an expected

decline in rapeseed oil production (-2. 7% yoy). On the demand front, the consumption growth is expected to be

driven mainly by soybean oil (+7.5% yoy), followed by palm oil (+4.8% yoy), while rapeseed oil consumption is

projected to fall by 1.4% yoy. Out of the total projected consumption for 2011, 50% of this is expected to come

from the biofuels sector, based on the global mandates in place. With these new projections, Oil World sees the

global market for vegetable oils to remain tight, with the world market struggling to increase production

sufficiently to meet requirements, and consumers becoming more reliant on the supply of palm oil and soya oil.

As a result, Oil World expects to see vegetable oil prices remaining firm and strengthening in the year ahead.

Chart 3 : Eight Vegetable Oils Stock/ Usage Ratio

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2005 2006 2007 2008 2009 2010F 2011F

U s a g e (

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10.0%

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10.6%

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S t o c k / u s

a g e r a t i o ( % )

Disappearance Stocks/Usage Ratio

Source: Oil World, RHBRI

♦ … an increase in the biodiesel mandate in Argentina; and... China’s ban on Argentinean soyoil is still in

place, despite many naysayers saying it would not last. The government has finally responded to this by

increasing the admixture mandated for biodiesel to 7%, most likely to be implemented from Sep 2010 onward

(from 5%, which was mandated from Mar 2010 onwards). It is likely that this mandate will be raised further to

10% by Jan 2011, while the government is also building more power plants to be fueled by biodiesel so as to

increase domestic demand for soyoil. This will serve to reduce soyoil supply from Argentina in the longer term,

and therefore result in increasing reliance on palm oil for the food industry.

♦ … a continuation of La N iña temperatures which could have a longer-term impact on production.

According to the climatic models, sea surface temperatures in the central equatorial Pacific have continued to cool

over the past fortnight, and are consistent with the developing stages of a La Niña event. The majority of climate

models surveyed by the Bureau suggest current patterns and trends will continue, with a significant likelihood of

further ocean cooling beyond La Niña thresholds, and the chance of a La Niña in 2010 is now clearly more likely

than not. The Southern Oscillation Index (SOI) remains in positive territory, and was around +1.8 in June (+10.0



Page 4 of 8

13 July 2010


in May). Should this sustain at above +5.0 for another few consecutive months, this would be a confirmation of

La Niña, the impact of which, would be felt on harvesting immediately, and on production 9-12 months later.

Chart 4 : Southern Oscillation Index Chart

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S o u t h e r O s c i l l a t i o n I n d e x ( S O I )

SOI CPO Price El Nino La Nina

La Nina: SOI > +5

El Nino: SOI < -5

Source: Australian Bureau of Meteorology

♦ Short-term negatives in the form of a possibility of reduction of Argentine export tax;… In Argentina, at

the end of August, the special power given by Congress to the Argentine government ends and the opposition is

expected to enforce changes to export taxes. Some of the scenarios being put forth include the elimination of export taxes on wheat, corn, sunflowerseed and products and a reduction in soybean export tax for the smaller

farmers. Although this is still very preliminary and a very politically-sensitive situation, we are wary of the

negative consequences of such a move on the global vegetable oil market and prices.

♦ … USDA planting data report – which showed increased soybean acreage; and… The USDA planting data

report released at end-June showed an increase in the soybean acreage estimates of 1% from end-Mar’s

intentions, while corn acreage showed an opposite 1% decline from end-Mar’s intentions. For corn, the planted

acreage was 1.7% (or almost 1.5m acres) below consensus expectations, while for soybean, the planted acreage

was 0.8% (or about 0.6m acres) above consensus expectations. All in, this would mean a 2% yoy increase in

both soybean acreage (to 78.9m acres) and corn acreage (to 87.9m acres) in 2010. This indicates the US

farmers’ expectations that margins for soybean would continue to be better than that of corn going forward into

the next crop year. With the larger soybean crop expectations based on planted acreage, and near-record global

soybean stocks of an estimated 69.9m tonnes as at end-Sep 2010, this could see global soybean stocks rising by

7% yoy in Sep-2011 to as high as 74.8m tonnes. While this would seem to have a bearish impact on CPO prices,

we note that this depends very much on how much soybean is actually crushed and exported out, which in turn

would depend on the crushing margins at the time of harvesting.

♦ … the reduction in competitiveness of CPO vs soyoil. In the last month, the discount between CPO and

soyoil has narrowed to US$82/tonne and is now lower than the average historical levels of US$100/tonne (from

an average of US$89/tonne last month), while the discount between CPO and rapeseed oil has widened to

US$103/tonne (from US$87/tonne last month) (see Charts 1 & 5). Given the narrower discount between CPO and

soyoil, we expect to see demand rebalancing happening again in the more price-sensitive markets like China and

India. This is already expected to be seen in India, where a shift in Indian import demand towards soyoil in the

second half of the Oct/Sep 2009/10 crop year would result in imports of CPO falling by 7.3% yoy in Oct/Sep

2009/10, as compared to a 57.5% yoy projected increase in soyoil imports. This can already be seen happening

in YTD June 2010, as Indian imports of Malaysian CPO have fallen 18.1% yoy to 566.8m tonnes.



Page 5 of 8

13 July 2010


Chart 5 : Di scount betw een CPO and Soyoil and CPO and Rapeseed Oil in US$

Source: Bloomberg, RHBRI

♦ Cautious ST outlook maintained, although LT outlook still positive. Based on the recent developments

noted above, we summarise that the near-term outlook remains cautious with no significant positive catalysts for

CPO prices at the moment. In the longer-term however, supply and demand statistics remain positive, while

weather uncertainties remain an upside risk to prices, all of which would support CPO prices above

RM2,000/tonne for the long term.

Forecasts

♦ CPO price forecasts maintained. No change to our forecasts as we maintain our CPO price forecasts of an

average of RM2,500/tonne for CY2010, RM2,700 for CY2011 and RM2,500 for CY2012.

Risks

♦ Main risks include: (1) a significant change in crude oil price trend resulting in significant movement of CPO

and other vegetable oils prices; (2) weather abnormalities resulting in an over- or under-supply of vegetable

oils; (3) change in emphasis on implementing global biofuel mandates and trans-fat policies; (4) significant

changes in trade policies of vegetable oil importing or exporting countries; and (5) sharper-than-expected

global economic slowdown.

Valuations and Recommendations

♦ Neutral maintained. We are maintaining our Neutral recommendation on the plantation sector, as we believe

there are not many positive catalysts which would move CPO prices up in the near term, and therefore expect

plantation companies’ share prices to remain lacklustre until this scenario changes. Despite this, we continue

to have Outperform recommendations on some stocks within the sector including SGX-listed First Resources

(FV = S$1.35), KLK (FV = RM20.55), IOIC (FV = RM6.65) and CBIP (FV = RM3.70), while we maintain

our Underperform recommendations on Sime Darby (FV = RM8.15), Genting P lantation (FV = RM6.50)

and IJMP (FV = RM2.30).

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CPO v soyoil CPO v rapeseed oil



Page 6 of 8

13 July 2010


Table 2. Valuation Bases

Company

Fair Value

(RM/ share) Valuation Methodology

Genting

Plantations

6.50 Target 14.5x PER CY11 earnings.

CBIP 3.70 Target PER of 6x CY11 for the oil mill engineering division and 12x CY11 for the plantation division.

IJMP 2.30 Target 14.5x PER CY11 earnings

IOIC 6.65 Target PER of 16x CY11 for the plantation division, 10.5x CY11 for the manufacturing division and 12x

CY11 for the property development and investment property divisions (on fully diluted basis).

KLK 20.55 Target PER of 16x CY11 for the plantation division, 10.5x CY11 for the manufacturing division, 12xCY11 for the property division and zero value less potential provisions for the retail division.

Sime Darby 8.15 25% holding company and corporate governance risk discount to SOP comprising: target PER of 16xCY11 for the plantation division and 12x CY11 for the energy & utilities division, heavy equipment,

property, motor and other small divisions.

First

Resources

S$1.35 Target 10.0x PER CY11 earnings

Source: RHBRI

Table 3: Impact of every RM100/ tonne increase in CPO price

Genting Plantations +5-7%

KLK +4-6%

IJMP^ +5-7%

IOI Corp +3-5%

Sime Darby +4-6%

First Resources +8-10% (for every US$50/tonne increase)

CBIP +2-4%

Source: RHBRI

Table 4. Regional Peer Comparison

Company FYE Price * Currency PER (x) EV/ EBITDA (x) P/ NTA (x)

FY10f FY11f FY10f FY11f FY10f FY11f

WIL SP Equity Dec 6.03 SGD 15.3 13.8 8.6 7.7 2.2 1.9

IFAR SP Equity Dec 2.08 SGD 13.5 11.1 4.4 3.9 1.9 1.6

GGR SP Equity Dec 0.54 SGD 14.2 9.6 6.4 5.5 0.9 0.9

FR SP Equity Dec 1.08 SGD 10.6 9.6 5.8 5.7 1.7 1.5

Average (S ingapore ) 13 .4 11 .0 6 .3 5 .7 1 .7 1 .5

AALI IJ Equity Dec 18,700 IDR 12.6 11.2 9.2 8.2 4.0 3.4

LSIP IJ Equity Dec 7,750 IDR 11.0 10.4 7.7 7.6 2.2 1.9

SGRO IJ Equity Dec 2,275 IDR 10.4 9.4 6.9 6.1 2.0 1.7

UNSP IJ Equity Dec 360 IDR 6.0 5.3 2.9 2.6 0.5 0.5

Average ( I ndones ia) 11 .3 10 .3 7 .9 7 .3 2 .7 2 .3

Ave rage (ex -Ma lays ia ) 12 .5 10 .7 7 .0 6 .4 2 .1 1 .8

Malaysia Ave 18.9 15.2 12.0 10.0 2.6 2.4

Msia's % premium/(discount) over peers 50.8% 41.8% 71.2% 56.7% 23.1% 30.7%

* @ 12 July, in respective currencies

Source: Bloomberg, IBES Consensus & RHBRI



Page 7 of 8

13 July 2010


IMP ORTANT DISCLOSURES

This report has been prepared by RHB Research Institute Sdn Bhd (RHBRI) and is for private circulation only to clients of RHBRI and RHB Investment BankBerhad (previously known as RHB Sakura Merchant Bankers Berhad). It is for distribution only under such circumstances as may be permitted by applicable law.The opinions and information contained herein are based on generally available data believed to be reliable and are subject to change without notice, and maydiffer or be contrary to opinions expressed by other business units within the RHB Group as a result of using different assumptions and criteria. This report is notto be construed as an offer, invitation or solicitation to buy or sell the securities covered herein. RHBRI does not warrant the accuracy of anything stated hereinin any manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against RHBRI. RHBRI and/or its associatedpersons may from time to time have an interest in the securities mentioned by this report.

This report does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectivesof persons who receive it. The securities discussed in this report may not be suitable for all investors. RHBRI recommends that investors independently evaluateparticular investments and strategies, and encourages investors to seek the advice of a financial adviser. The appropriateness of a particular investment orstrategy will depend on an investor’s individual circumstances and objectives. Neither RHBRI, RHB Group nor any of its affiliates, employees or agents acceptsany liability for any loss or damage arising out of the use of all or any part of this report.

RHBRI and the Connected Persons (the “RHB Group”) are engaged in securities trading, securities brokerage, banking and financing activities as well as providinginvestment banking and financial advisory services. In the ordinary course of its trading, brokerage, banking and financing activities, any member of the RHB

Group may at any time hold positions, and may trade or otherwise effect transactions, for its own account or the accounts of customers, in debt or equitysecurities or loans of any company that may be involved in this transaction.

“Connected Persons” means any holding company of RHBRI, the subsidiaries and subsidiary undertaking of such a holding company and the respective directors,officers, employees and agents of each of them. Investors should assume that the “Connected Persons” are seeking or will seek investment banking or otherservices from the companies in which the securities have been discussed/covered by RHBRI in this report or in RHBRI’s previous reports.

This report has been prepared by the research personnel of RHBRI. Facts and views presented in this report have not been reviewed by, and may not reflectinformation known to, professionals in other business areas of the “Connected Persons,” including investment banking personnel.

The research analysts, economists or research associates principally responsible for the preparation of this research report have received compensation basedupon various factors, including quality of research, investor client feedback, stock picking, competitive factors and firm revenues.

The recommendation framework for stocks and sectors are as follows : -

Stock Ratings

Outperform = The stock return is expected to exceed the FBM KLCI benchmark by greater than five percentage points over the next 6-12 months.

Trading Buy = Short-term positive development on the stock that could lead to a re-rating in the share price and translate into an absolute return of 15% or

more over a period of three months, but fundamentals are not strong enough to warrant an Outperform call. It is generally for investors who are willing to takeon higher risks.

Market Perform = The stock return is expected to be in line with the FBM KLCI benchmark (+/- five percentage points) over the next 6-12 months.

Chart 6: IOICorp Technical View Point

♦ The share price of IOICorp enjoyed a smooth

uptrend, from a level below RM2.96 in late 2008 to

a high of RM5.60 in Jan 2010.

♦ However, after failing its attempts to penetrate the

tough resistance at RM5.60, it pulled back on mild

profit-taking activities.

♦ The stock relaunched another attempt to remove

the resistance in Mar 2010, but again, it was

snapped with another round of profit-taking

pressure. By May, it was already trading at below

the RM4.85 key level.

♦ But, the stock managed to recover to above the

RM4.85 level in early Jun, and immediately kicked

off a fresh recovery leg.

♦ It surpassed both the 10-day and 40-day SMAs in

recent trading and ended yesterday at RM5.09.

♦ Technically, its short-term technical readings have

improved, and it is ready to climb higher towards

the heavy resistance of RM5.60 in the near term.

♦ However, due to the muted daily average turnover

in recent months, the stock is still likely to be

trapped within the current trading range of RM4.85

– RM5.60 for the medium term, in our view.



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13 July 2010


Underperform = The stock return is expected to underperform the FBM KLCI benchmark by more than five percentage points over the next 6-12 months.

Industry/Sector Ratings

Overweight = Industry expected to outperform the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

Neutral = Industry expected to perform in line with the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

Underweight = Industry expected to underperform the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

RHBRI is a participant of the CMDF-Bursa Research Scheme and will receive compensation for the participation. Additional information on recommendedsecurities, subject to the duties of confidentiality, will be made available upon request.

This report may not be reproduced or redistributed, in whole or in part, without the written permission of RHBRI and RHBRI accepts no liability whatsoever forthe actions of third parties in this respect.

Plantation - Peak Production Period To Start Soon - 13/7/2010

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