Industry Comparison – Palm Oil Part III

Sector                 : Plantation

Sub Sector         : Plantation

Part I – Top 10 palm oil companies interm of 2018 revenue

Part II –11 – 20 palm oil companies interm of 2018 revenue

Part III – 21 – 30 palm oil companies in term of 2018 revenue

Part IV – Summary of comparison based on 2018

21 - 30 palm oil companies listed in Bursa base on 2018 revenue are:

21) RSAWIT(5113) – RIMBUNAN SAWIT BERHAD

22) MHC(5026) – MHC PLANTATIONS BHD

23) SWKPLNT(5135) – SARAWAK PLANTATION BERHAD

24) UMCCA(2593) – UNITED MALACCA BERHAD

25) CEPAT(8982) – CEPATWAWASAN GROUP BERHAD

26) NPC(5047) – NPC RESOURCES BERHAD

27) TDM(2054) – TDM BERHAD

28) HARNLEN(7501) – HARN LEN CORPORATION BHD

29) CHINTEK(1929) – CHIN TEK PLANTATION BERHAD

30) INNO (6262) – INNOPRISE PLANTATIONBERHAD

Competitiveness

Market shares is an importance indicator to determine the competiveness of the company. Total revenue make from palm oil plantation and refinery for the year 2018 is RM 68,524,704,870.00.

COMPANY	REVENUE (OIL PALM) 2018 (RM)	MARKET SHARE (%)
RSAWIT (5113)	335,193,997	0.49
MHC (5026)	315,734,166	0.46
SWKPLNT (5135)	309,894,966	0.45
UMCCA (2593)	271,074,000	0.40
CEPAT (8982)	225,276,000	0.33
NPC (5047)	219,405,000	0.32
TDM (2054)	196,562,000	0.29
HARNLEN (7501)	178,084,624	0.26
CHINTEK (1929)	149,924,411	0.22
INNO (6262)	114,222,418	0.17

Dependency

Many palm oil companies had other investment such as properties development, logistic, sugar, manufacturing and etc which is not subjected to the price change on the palm oil. Table below shown the dependency of palm oil for each company

COMPANY	PERCENTAGE OF REVENUE FROM PALM OIL (%)
RSAWIT (5113)	98.97
MHC (5026)	95.35
SWKPLNT (5135)	100.00
UMCCA (2593)	97.41
CEPAT (8982)	88.74
NPC (5047)	96.07
TDM (2054)	50.75
HARNLEN (7501)	95.22
CHINTEK (1929)	100.00
INNO (6262)	100.00

From the table TDM had less than 80% of their revenue from palm oil. Other businesses which TDM are involve;

1) TDM –  Healthcare, TDM operate 4 hospitals which are:

a)    Kelana Jaya Medical Centre (KJMC)

b)   Kuatan Medical Centre (KMC)

c)    Kuala Terengganu  Specialist Hospital (KTS)

d)   Taman Desa Medical Centre (TDMC)

Operational

For operational, operating income of the companies had been review. Operating income determine how much the companies’ revenue had turn into profit after reduction cost of operating expense.

Besides operating income, operatingmargin ratio is also calculated. Companies with higher operating margin ratio have more probability to survive in today financial crisis.

COMPANY	2018 OPERATING INCOME (RM)	2018 OPERATING MARGIN RATIO
RSAWIT (5113)	(159,050,472)	-47.45
MHC (5026)	29,160,682	8.90
SWKPLNT (5135)	24,536,802	7.92
UMCCA (2593)	31,676,000	11.69
CEPAT (8982)	14,652,000	6.67
NPC (5047)	3,627,000	1.65
TDM (2054)	(52,549,000)	-25.59
HARNLEN (7501)	1,021,112	0.57
CHINTEK (1929)	84,123,593	56.11
INNO (6262)	15,101,434	13.22

RSAWIT, UMCCA and TDM would be disqualified to analyst further because they having negative operation income. CHINTEK had high operation margin ratio in 2018.

Sustainability

For the sustainability of the business, debt of the companies is being review. There are two criteria to look at interest coverage ratio , which is used to determine how easy the companies able to pay off the interest of outstanding debt and debt ratio.

COMPANY	2018 INTEREST COVERAGE RATIO	2018 DEBT RATIO
RSAWIT (5113)	-6.36	0.60
MHC (5026)	4.09	0.30
SWKPLNT (5135)	3.70	0.37
UMCCA (2593)	11.69	0.23
CEPAT (8982)	2.66	0.30
NPC (5047)	0.21	0.73
TDM (2054)	-2.03	0.49
HARNLEN (7501)	0.10	0.50
CHINTEK (1929)	No Financial Cost	0.05
INNO (6262)	8.10	0.20

CHINTEK had no financial cost or low financial cost in 2018.

Summary of Stock Reviews

Summary of Industry Comparison