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More than 10 years back, there is a financial crisis that brought down a lot of big corporate into their knees. If you would recall back, during the 2008, when everything is tumbling down, PALM OIL and SOY OIL had risen so sharply in the global market.
Now more than 10 years after that event, is this event going to happen again? Are you looking at CRUDE PALM OIL heading to a great break out from the 10 years long resistant bar?
HERE IS CHART FOR US SOYBEAN OIL
HERE ARE SEVERAL REASON FOR FCPO TO BREAK OUT 3000 IN YEAR 2020
1. INDIA INCREASING IMPORT DUE TO DEEPAVALI CELEBRATION
2. CHINA INCREASING IMPORT DUE TO MOONCAKE FESTIVAL SEASON
3. EUROPE/US INCREASING IMPORT DUE TO CHRISTMAS SEASON
OTHER FACTORS INCLUDE
1. GLOBAL COUNTRY LOOKING FOR FOOD SECURITY DURING CRISIS PERIOD
2. PALM OIL INDUSTRY BOTTOM UP ON SHARE PRICE AND READY FOR UPWARDS RUN
3. CRUDE PALM KERNEL OIL & PROCESSED PALM KERNEL OIL TAX EXEMPTION ON EXPORT DUTY FROM 1ST JULY 2020 UNTIL 31ST DECEMBER 2020
There are many counter that are interesting. Some are good, some are bad, some are turning good but still at low prices.
The one I see turning good and still in low price is THPLANT - 5112
WHY I THINK THPLANT IS GOOD ?
THPLANT is having a good technical chart reading. The uptrend is supported with better outlook in the overall industry. With FCPO at good prices, and THPLANT at the lowest price region in the past 10 years, it is not too bad a gamble with calculated risk.
Comparing with other peers around the similar size, THPLANT FFB production is considerable good.
Now THPLANT is already fully impaired. Although THPLANT have a large debt pile, the lower interest rate will be beneficial with lower interest servicing. A lot of analyst will be expecting a further cut in the coming BNM policy meeting.