- We downgrade Wilmar to HOLD with target price of S$ 3.00. This is based on FY26 P/E of 11.7x, which is in line with its current trading multiple. The current P/E of 11.3x is also near its 5-year average P/E of 11.8x.
Limited room for re-rating for the rest of 2025
- - Read this at SGinvestors.io -
- Note that our thesis of Wilmar valuation re-rating will be driven by both profitability and ROE expansion from consumer products division expansion.
The Indonesia cooking oil case is still ongoing and Wilmar has set aside US$720m.
- - Read this at SGinvestors.io -
- The US$720m potential provision represents around 65% of our FY25F earnings forecast, and 55% of consensus’ estimate of US$1.3bn.
- We believe the penalty will not impact Wilmar’s strong balance sheet, as its cash position as of June 2025 stands at US$3bn, excluding less liquid bank deposits of US$3.7bn.
Earnings revisions – imputing higher tax rate, weaker palm oil refining margins.
- Read more at SGinvestors.io.
