Latest news with #SDGuthrieBhd
New Straits Times
2 days ago
- Business
- New Straits Times
SD Guthrie poised to unlock RM1.3bil profit from land monetisation strategy
KUALA LUMPUR: SD Guthrie Bhd is set to further accelerate its industrial park development strategy, following a series of joint ventures, memoranda of understanding (MOUs), and land sale agreements covering over 2,387 hectares at key locations across Malaysia over the past year. Analysts said these initiatives reflect the group's strategy to unlock value from its extensive land bank while supporting national objectives to attract investment, generate employment, and promote sustainable industrial growth. "SD Guthrie holds vast tracts of plantation land across the country. By converting selected parcels into industrial developments, it is able to monetise idle assets, enhance income potential, and improve capital efficiency," said an analyst who spoke on condition of anonymity. He noted that joint venture-led projects, in particular, provide recurring income streams and represent a significant step towards diversifying the company's earnings beyond its core plantation operations. With rising demand for industrial space driven by e-commerce, manufacturing, renewable energy, and logistics, SD Guthrie is strategically aligning its projects with government-backed corridors such as Malaysia Vision Valley 2.0 (MVV 2.0) and the port-centric development of Carey Island. SD Guthrie's latest deal, inked on June 24, 2025, involves a 242 ha industrial project within the company's Sengkang Estate in Port Dickson with Negeri Sembilan Menteri Besar Incorporated (MBINS). The two agreements signed with MBINS form the first two phases of the Port Dickson Free Zone (PDFZ), a flagship initiative under the MVV 2.0 development corridor. The PDFZ will eventually span 574 ha and include warehouses, logistics hubs, manufacturing facilities, and essential infrastructure. Strategically located next to Tanco Holdings Bhd's upcoming Smart AI Container Port (Midport), the development is set to enhance Negeri Sembilan's position as an emerging logistics and maritime hub. The master plan is expected to be finalised by the first quarter of 2026, with development works commencing in the second quarter. According to CIMB Securities Sdn Bhd, the project benefits from strong road connectivity via the Seremban–Port Dickson Highway and the Port Dickson–Linggi network, both of which link to the North-South Expressway. "This offers seamless access to MVV 2.0, the primary economic corridor on the west coast of Peninsular Malaysia. The deal allows SD Guthrie to immediately monetise part of its land while securing a future recurring income stream," it said in a note. Just days earlier, SD Guthrie also announced a major collaboration with Sime Darby Property to co-develop up to 809 ha in Carey Island, equivalent to about 7 per cent of its 11,592 ha landholding there. The project will be undertaken via a special-purpose vehicle (SPV) aimed at supporting the Selangor state government's vision to transform Carey Island into a key industrial and logistics hub. "The development will co-exist with the island's integrated palm oil operations and complement activities at Westport and Northport in Port Klang. While the JV's shareholding structure has not been disclosed, the companies confirmed that PNB will nominate the chairman of the newly formed SPV. SD Guthrie currently owns 79 per cent of Carey Island, or approximately 11,592 ha," CIMB noted. In May 2025, SD Guthrie formalised another key JV with Eco World Development Group Bhd and Negeri Sembilan Corporation (NS Corp) to jointly develop 483.6 ha in Mukim Jimah. SD Guthrie will retain a 30 per cent stake in the RM2.95 billion GDV project, with the land transacted at RM11 per sq ft. Beyond the Klang Valley and central region, SD Guthrie is also expanding in the southern and northern states. In November 2024, it partnered with AME Elite Consortium Bhd to develop a 259 ha green industrial park in Kulai, Johor, featuring a dedicated solar park. In Negeri Sembilan, the company has partnered with TH Properties for a 187.7 ha industrial project in Bukit Pelandok, valued at RM220 million or RM10.89 per sq ft. Meanwhile, in May 2024, SD Guthrie and PNB launched the 404.7 ha Kerian Integrated Green Industrial Park (KIGIP) in Perak. Supported by a 267 ha solar farm, KIGIP is set to become one of the largest integrated green industrial zones in northern Malaysia. CIMB noted that the earnings impact from these initiatives will depend on how quickly SD Guthrie can obtain necessary approvals, execute land launches, and begin generating income. "Assuming all seven MoUs and agreements signed result in an average land sale price of RM10 per sq ft, we estimate total land sales proceeds could reach up to RM2.57 billion for 2,387.6 ha of land," it said. With a low land cost base, a 30 per cent retained stake in joint ventures, and a 24 per cent corporate tax rate on disposal gains, SD Guthrie could realise profits of up to RM1.3 billion, well above its RM500 million annual land sales target. CIMB reiterated its 'Hold' rating on SD Guthrie, maintaining a sum-of-parts-based target price of RM5.06 per share. Kenanga Research projects the gross development value (GDV) of SD Guthrie Bhd's Port Dickson property venture to be between RM1 billion and RM3 billion, with the development potentially stretching over five years or more. Despite this, the research house is keeping its earnings forecasts for FY2025 and FY2026 unchanged, noting that SD Guthrie had earlier guided for RM500 million in land disposal gains this year, a figure already incorporated into its estimates. "Year-to-date, SD Guthrie has accumulated about RM300 million in land disposal gain from concluded projects. Hence, there is still about RM200 million in headroom from the guided RM500 million disposal gain for this year. For FY 2026, we are raising our earlier gain of RM50 million to RM200 million. However, we are leaving the FY 2025 to FY 2026 forecast core net profit intact," it said. Kenanga has maintained its "Market Perform" rating on SD Guthrie, with a target price of RM4.60. The research house highlighted several risks to its outlook, including continued Western scrutiny of palm oil over sustainability and biodiversity issues, weather disruptions, labour shortages, soft commodity prices, and rising operating costs. Kenanga also views the group's strategic expansion into industrial property development as a long-term positive, with the potential to boost return on equity (ROE). However, it cautioned that these benefits may take time to be realised due to execution challenges. "SD Guthrie is defensive and assets rich but earnings growth is modest and extra dividends from disposals may be expected," it said.
New Straits Times
6 days ago
- Business
- New Straits Times
SD Guthrie, MBINS to develop Port Dickson Free Zone
SEREMBAN: SD Guthrie Bhd (SD Guthrie) and Menteri Besar Incorporated Negeri Sembilan (MBINS) will develop the Port Dickson Free Zone (PDFZ) in Pasir Panjang, Port Dickson, covering an area of 242.8 hectares (600 acres) with a gross development value (GDV) projected to exceed RM1 billion. The area is located at Ladang Sengkang, Pasir Panjang, which is owned by SD Guthrie. Infrastructure construction work is expected to begin in the second quarter of 2026, subject to the establishment of a joint venture entity and finalisation of the master plan, expected in the first quarter of 2026. The Menteri Besar of Negeri Sembilan, Datuk Seri Aminuddin Harun, said the PDFZ will be built opposite the Midport Smart Artificial Intelligence (AI) Container Port site in Port Dickson and will serve as a key catalyst for the growth of Midport. He said the development of this industrial zone includes the construction of facilities such as warehousing areas, high-tech factories, and other supporting infrastructure, subject to approval from relevant authorities. "This initiative has the potential to boost further the state's industrial sector as well as strengthen the economic and investment ecosystem in the region. The integration between Midport and PDFZ will maximise synergy in logistics operations, light processing, and manufacturing sectors. "This will position Midport as the preferred port with a smooth supply chain system for related industries. The existence of PDFZ also plays a role in attracting strategic investments from major global industrial companies and optimising the use of container transportation and maritime services," he said during his speech at the signing ceremony of the land sale agreement and Memorandum of Understanding (MOU) between MBINS and SD Guthrie here today. Also present was SD Guthrie group managing director, Datuk Mohamad Helmy Othman Basha. Meanwhile, Aminuddin explained that the initial focus of the project is on transferring basic infrastructure land and promotion to investors, while in the long term, PDFZ will become a high-tech industrial hub supporting the growth of Midport. "According to the plan, the physical construction of Midport will commence soon and is expected to take several years before becoming fully operational. The target is for the port to operate as early as 2027, and the first phase of PDFZ will also be completed by then to support port operations," he said, adding that by 2035, Port Dickson has the potential to emerge as a 'New Port City', famous domestically and internationally. Aminuddin said the state government targets a gross domestic product (GDP) growth rate of 8.1 per cent annually until 2045, and under the Malaysia Vision Valley 2.0 (MVV 2.0) framework, the Midport and PDFZ projects are among the strategic drivers towards achieving that target. Meanwhile, Mohamad Helmy said the PDFZ project is a strategic and visionary initiative aligned with the nation's development aspirations and sustainable progress agenda, and can strengthen Midport's function through the provision of industrial infrastructure. He said the collaboration with MBINS further strengthens SD Guthrie's presence in the industrial development landscape of Negeri Sembilan. "The approach of combining land commercialisation with strategic partnerships allows us to realise asset value immediately while creating new potential recurring income streams for the company. This is a model that can be expanded, and we intend to apply it in efforts to leverage our high-potential strategic land reserves across the country. We are also proud to contribute to this development effort, which is expected to provide various socio-economic benefits to the people," he said.
The Star
23-06-2025
- Business
- The Star
Trading ideas: SD Guthrie, Gadang, Maxim, HLBank, Vanzo, Cuckoo, Ecobuilt, Wasco, Poh Huat
KUALA LUMPUR: Here is a recap of the announcements that made headlines in Corporate Malaysia. SD Guthrie Bhd , formerly known as Sime Darby Plantation Bhd, and its sister company Sime Darby Property Bhd have entered into an agreement to jointly develop up to 2,000 acres of land on Carey Island, Selangor. Gadang Holdings Bhd 's wholly owned subsidiary, Gadang Engineering (M) Sdn Bhd, has secured a RM92.5mn contract to widen the Kuala Lumpur-Karak Highway. Maxim Global Bhd has filed an appeal to overturn a stay order granted by the High Court this week that temporarily halts its high-rise residential project here. Hong Leong Bank Bhd has issued RM400mn in nominal value of Tier 2 subordinated notes under its multi-currency Tier 2 subordinated notes programme. Vanzo Holdings Bhd's wholly owned subsidiary has appointed Taiwan-based Xishangxi International Marketing Co Ltd as the exclusive distributor of VASB's products in both online and physical Watsons stores in Taiwan. Cuckoo International (Malaysia) Bhd is set to go public in Malaysia on June 24 after a scaled-down offering that's expected to raise RM395mn. Ecobuilt Holdings Bhd today announced the resignation of its CEO Lim Chin Yen effective immediately. He is succeeded by Fong Tuck Yong. Wasco Bhd is planning to list its wholly owned unit, Wasco Greenergy Bhd, which operates biomass and steam energy businesses, on the Main Market of Bursa Malaysia. Poh Huat Resources Holdings Bhd reported a 92.1% YoY drop to RM575,000 in quarterly net profit, as demand from the US softened amid tariffs and higher operating costs dented earnings.
The Star
17-06-2025
- Business
- The Star
Sales tax may pressure planters' competitiveness
PETALING JAYA: The competitiveness of the local palm oil industry will likely be eroded by the implementation of the expanded sales and service tax in July, analysts say. The tax will increase raw material costs, although some of the additional cost may be passed on to buyers, says CIMB Research. Major listed plantation companies with palm oil operations in Malaysia include SD Guthrie Bhd , FGV Holdings Bhd , Kuala Lumpur Kepong Bhd , IOI Corp Bhd and Wilmar International Ltd. 'Overall, we are slightly negative on the indicative 5% sales tax on crude palm kernel oil for Malaysian palm oil players, although the industry may seek a government waiver if the tax undermines local competitiveness against Indonesia,' said CIMB Research in a report yesterday. The research house said it understands from the Malaysian Palm Oil Association and planters that fresh fruit bunches (FFB) will be exempted from the 5% sales tax, despite being listed among taxable goods. 'This is because the sales tax applies only to the manufacturing sector, and FFB is classified as a locally harvested raw material intended for further processing rather than a manufactured product,' CIMB Research said. However, palm kernel oil, refined, bleached and deodorised palm kernel oil and palm kernel shell have been reclassified from tax-exempt goods to those subject to a 5% sales tax under the Sales Tax Order 2025. It remains unclear whether the industry will seek exemptions for these products, added the research house. Meanwhile, CIMB Research said the US Environmental Protection Agency's (EPA) proposal for 5.61 billion gallons of biodiesel under a mandate for next year is supportive of demand for edible oil and crude palm oil (CPO) prices, as the mandate will help sustain US consumption of edible oils. 'We maintain our CPO price forecast of RM4,200 per tonne for this year and reiterate our sector top picks, IOI and Hap Seng Plantations Holdings Bhd ,' said the research house. For next year, the EPA has set a target of 7.12 billion biomass-based diesel renewable identification numbers (RINs), which is expected to translate into 5.61 billion gallons of actual biodiesel blended that year. 'This target is expressed in RINs, in line with the EPA's broader objective to limit the number of RINs generated from imported biofuels,' CIMB Research said. As a result, the EPA now projects that each gallon of biomass-based diesel will generate 1.27 RINs in 2026 and 1.28 RINs in 2027, down from the previous estimate of 1.6 RINs. In comparison, the 2025 biomass-based diesel volume mandate stood at just 3.35 billion gallons, a level widely criticised by the industry as inadequate. Notably, the 2026 blending target of 5.61 billion gallons for biomass-based diesel volume exceeds the 5.25 billion gallons requested by the industry. 'We are positive on the proposed 2026 mandate, as fulfilling the 5.61 billion gallons or 19.2 million tonnes of biodiesel would support the use of edible oils as feedstock to meet the US biodiesel requirement. For context, US biodiesel production last year stood at around 16 million tonnes.' The final rule for the Renewable Fuel Standard (RFS) targets in the United States is expected to be published by the end of this year. Under the RFS, oil refiners are required to either blend substantial volumes of biofuels into the US fuel supply or purchase compliance credits known as RINs from others who exceed their blending obligations. Small refiners may apply for exemptions if they can demonstrate that complying with the mandate would cause undue economic hardship. The proposal reflects a significant shift in biomass-based diesel requirements, noted CIMB Research.
The Star
11-06-2025
- Business
- The Star
CPO prices to remain under short-term pressure
PETALING JAYA: Analysts expect crude palm oil (CPO) prices to remain under pressure in the mid to short-term given the rising inventory and higher output trends. The latest Malaysian Palm Oil Board's palm oil statistics for May revealed that palm oil stocks surged to 1.99 million tonnes, up 6.6% month-on-month and 13.5% year-on-year. Production for the month under review also hit an eight-month high at 1.77 million tonnes. Hong Leong Investment Bank Research (HLIB Research) in a report said the palm oil stock level will likely remain near the two million tonne mark this month. 'This is as seasonally higher crop yields and subdued festive-driven demand are expected to be offset by potentially stronger demand from India, following its recent decision to reduce the import duty on CPO to 10% from 20%,' the research house added. HLIB Research, which is 'neutral' on the sector given the absence of clear demand catalyst, said, 'We maintain our 2025 to 2026 CPO price assumptions of RM4,000 per tonne and RM3,800 per tonne, respectively, with the view that continued output recovery particularly from Indonesia will continue to cap palm oil prices over the near-to-medium term.' For exposure, the research house's top picks are SD Guthrie Bhd with a target price of RM5.17, Johor Plantations Group Bhd at RM1.35 and IOI Corp Bhd at RM4.24. Meanwhile, RHB Research is still 'overweight' on the sector with planters' earnings likely to continue to grow this year, on higher CPO and palm kernel prices. The research house firm said it made no changes to its recommendations after the reporting season for the first quarter of this year (1Q25) as the earnings results were mostly within expectations. RHB Research noted 11 planters under its coverage turning earnings in line with forecasts, while three underperformed. Its top picks within the sector include Johor Plantations, Sarawak Oil Palms Bhd , Bumitama Agri Ltd, PP London Sumatra Indonesia and SD Guthrie Bhd. In Malaysia, RHB Research expects palm oil output should continue ramping up towards the peak season, while demand should also improve, as 'CPO prices are currently within historical discounts versus its competitors'. MIDF Research said in a note to clients: 'We anticipate that the CPO prices will remain stabilised, hovering within the range of RM3,900 to RM4,200 per tonne. 'This is typically in line with seasonal production trends, as the pollination period ends in March and palm oil output is expected to recover – potentially leading to an increase in closing stock levels.' The research house said that the sector's top-line will continue to rise for the first half of this year, in line with higher average CPO price assumptions. 'However, margins are likely to remain under pressure due to the persistent elevated cost of production, caused by the higher locked in fertiliser costs from the second half of last year, coupled with elevated external fresh fruit bunch (FFB) purchase expenses amid low mills utilisation rates,' it added. MIDF Research has maintained a 'neutral' call on the sector at this juncture. While the CPO prices are expected to remain under pressure, it expects production is likely to perform, leading to a ceteris paribus performance for 2025. 'Therefore, we foresee only a handful of players likely to benefit from elevated CPO prices. 'Hence, we recommend avoiding smaller players with significant exposure to external FFB purchases as these factors could risk their CPO production, particularly during the current biological tree rest environment,' the research house noted. Instead, MIDF Research suggested focusing on larger players such as IOI with a target price of RM4.42, SD Guthrie at RM5.43 and Genting Plantations Bhd at RM6.10, whose CPO procurement, which are over 50% from their own estates offers more stability in realising CPO prices. TA Research in a report said its CPO price forecast is unchanged at RM3,800 per tonne for this year. It reiterated a 'hold' call on SD Guthrie, Kuala Lumpur Kepong Bhd and Kim Loong Resources Bhd , while maintaining a 'buy' call on United Malacca Bhd and TSH Resources Bhd .
