New Britain Palm Oil Share Discussion Threads

[bogotatrader] 29/8/2012 19:55

AEP better value than this dog.....

[woracle] 23/8/2012 16:22

interesting skanjete... didnt know the reason for kina rise despite usd strength this year. Was 15 years ago i was in Port Morseby and back then it had the highest ratio of corpses in the morgue per population in the world so the expat aussies told me. Interesting place.. they still had cannibals in the hills back then. Unemployment was like 70% and the streets were marked red with Betel nut spit... glad its economy is finally picking up.

[skanjete2] 23/8/2012 16:10

Beside being overvalued, they had another problem.

They have the structural disadvantage of being located in Papua. Papua is a relatively small island and economy, and recently Exxon started some gigantic investments in the gas sector. The investment projects are huge in comparison to the Papua economy. The inflow of investment dollars caused the Kina to rise against the dollar. I think the Kina must have been about the strongest currency over the recent past.

Besides the rising Kina, the Exxon investments cause a great surge in labour demand and thus skilled labour costs.

[woracle] 23/8/2012 14:09

surely a misprint if brokers are being guided to full year pretax of only $100-105m.

[woracle] 23/8/2012 13:22

Been an investor in palm oil for almost a decade. Did a lot of research early on to understand the sector and differences in countries. Have owned aep, nbpo, mpe and rea at different times but aep is the only one i have kept all these years. if you go back through the aep thread many years you might see a very detailed comparison of them all i made. They are all good companies with their own strengths and weaknesses but at the right price. Nbpo is just being de-rated to reflect a more realistic premium. It does deserve one, but not as much as it has had in the past. I think foreward PE 10 to 12 is fair here. So yes, there will be an opportunity here if the derating is overdone. It is fundamentally a great business.

[hvs] 23/8/2012 08:29

Like Isaid stay well clear.

Way way overvalued.

[cisk] 22/8/2012 23:56

woracle, thanks for the comparisons. I dont know aep but I'm sure I ran a slide rule over rea - was that the one that the bod was retiring as they were all of retirement age maybe a year back? or was it mp evans?

I'll do some comparisons. I took a glance at aep h1 results and indeed they are positive reading - which makes me wonder why nbpo's were so bad. It does seem like they were unlucky with fx and weather, rather than doing anything particularly wrong.

Take your point about their rating, I'll do some comparisons. I do like the industry and product though, and view them as being relatively immune to global headwinds.

20% off in a day does seem steep, but that really depends if this is a one-off or repeated in h2.

tryto - could indeed be a buying opportunity. Be interesting to see the price movement tomorrow.

[trytotakeiteasy] 22/8/2012 23:30

woracle - sounds like you have done your research here... I had a look a while ago and found it all pretty confusing to be honest.... different political/tax issues in Malyasia and Indonesia... (palm oil companies in one of those countries trade at a discount but I don't remember which)... stocks in UK fairly illiquid.... palm oil price looks to have good prospects but volatile... threat of export taxes on the sector....

Which is your current favourite play in the sector... I reckon you think that NBPO could be a buying opportunity???? What is your favourite operational story (i.e. irrespective of the price)..

[woracle] 22/8/2012 22:34

you chose 2 of the least comparable companies. aep and less so rea after their entry to coal are much more comparable. Tell me why you think having its own refinary in Liverpool gives it a real edge. I have always admired nbpo and was a early holder but they became rediculously expensive even compared to the real class act majors on the singapore exchange.

[cisk] 22/8/2012 20:40

Folks, you miss the point. MP Evans went through a questionable restructuring. Equatorial Palm is still developing its acreage and it's crops are young.

NBPO is long established and is the leader in its field, regardless of the green credentials. It's Liverpool refinery give it an edge over the competition. It has bought more acreage in h1 hence the reduction in cash. You don't invest in this kind of company if you want a smooth ride - softs are volatile. Woracle makes a fair point that NBPO have just been unlucky - it could have easily been the other direction and posters on this board would have been crowing the other way saying how visionary the board are etc.

H2 should be much better. I'll eat my words if it's worse than h1.

[trytotakeiteasy] 22/8/2012 17:57

just looking at the broker downgrades and these are massive... I agree this has always seemed to be at a premium... which doesn't reflect the small country risks and the currency risks..... just a cash of "green" investors being pumped a story by a new palm oil kid on the block and buying it hook line and sinker... to my mind looks like it has much further to fall...... they also didn't adequately warn in advance of this profits warning..

[cisk] 22/8/2012 17:42

hvs, unless you're a rampant shorter and just want to talk the price down further, care to elaborate on why you think NBPO is overvalued?

[hvs] 22/8/2012 17:14

Way overvalued.

[trytotakeiteasy] 22/8/2012 14:35

trouble is focused on Just Papua New Guinea which isn't exactly a beacon of stability... but worth having a look here as could be an opportunity...

[cisk] 22/8/2012 13:24

why's that hvs?

[hvs] 22/8/2012 12:48

Stay well CLEAR.

[cisk] 22/8/2012 09:46

Buying opportunity. Short term blip at H1, H2 should fare better. Management implementing a number of controls to improve profitability. Results breakdown very candid and open, explaining the P&L drop.

Agri businesses are by their very nature volatile. NBPO is no exception to this. 20% currency appreciation and lower yield mainly to blame for the profits fall.

[weemonkey] 22/8/2012 09:42

mmm

have to say those results are a shocker.

[gorilla36] 22/8/2012 09:05

Profits warning.

[simon gordon] 30/4/2012 11:09

A palm oil storm in the making

Posted by Izabella Kaminska on Apr 30

Looking for supply headwinds in obscure commodity markets?

Then look no further than the global palm oil market.



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17/4/12:

0821 GMT [Dow Jones] Deutsche Bank initiates New Britain Palm Oil (NBPO.LN) at buy with a 1200p target. Thinks the company is exposed to some "very healthy" structural growth trends. Says there are growing supply/demand imbalances in the vegetable oils market and prices will therefore likely continue to rise for the ong term. Says the key risk in the short term for New Britain Palm Oil should remain crude palm oil price volatility. But in the long term, struggles to see how crude palm oil prices won't keep rising. Shares are up 0.3% at 865p. ([e-mail] Twitter: @ATryphonides)

[gl] 31/3/2012 18:49

How come as soon as it's tipped as a 'buy' by Paul Hill in Moneyweek the price falls? If the article he wrote has any truth to it then it surely should be a 'buy' stock. I guess it boils down to whether you think the tipsters in the financial magazines know what they are talking about or whether it is no more than straightforward guesswork.

[lucky_lady] 30/3/2012 14:14

Tipped in Money Week with a £10.80 price target

[poombear] 26/3/2012 10:23

Thanks, I've managed to find the IC tip.

Are these Bakery fats and shortenings usually produced in house by food manufacturers or by dedicated 3rd parties (expect it is both)?

What I haven't been able to establish is by how much this move "up the food chain" increases the value of sales.

Noted that 40% of their refined oil from Liverpool goe's to the bakery sector.