Peak production quarter still to come for First Resources, although risks remain: RHB

SINGAPORE (Nov 15): RHB is maintaining its “neutral” call on First Resources with a target price of $2.13, based on an unchanged FY18F P/E multiple of 13 times, in line with its five-year historical average. This implies an equity value per hectare (EV/ha) of US$13,500 ($18,352), which is in line with that of its peers who are trading in the US$10,000-15,000/ha range.

In a Wednesday report, RHB’s research team notes that First Resources has lowered its guidance for annual fresh fruit bunches (FFB) growth to 10-15% from 15% previously, despite recording a 27% y-o-y increase in 1H.