FGV (5222) WHY THE TIME IS NOW RIPE FOR IT TO GO UP BY MULTIPLE POWERFUL FUNDAMENTAL FACTORS, Calvin Tan Research
Dear Fellow Investors,
The Signs are all pointing to a Multi year Rebound of this bombed out FGV since IPO above Rm5.00 in year 2012.
Answer: Read very carefully the following signs!
1) In the Latest Budget Speech Finance Minister mentioned FELDA (out of more than 1,000 Klse stocks) to benefit from Rm400 Millions loan settlement.
This will indirectly benefit FGV as Felda might need to compensate FGV Rm4.1 Billions for taking back its lands
2) CRUDE PALM OIL HAS REACHED RM3208 A TONNE
In year 2012 when FGV was Rm5.30 at IPO and CPO was Rm2800
So FGV price at Rm1.15 is now down by 77% while CPO is up by 14.5%
And CPO was below Rm2000 early this year (NOW OVER RM3100)
This shows FGV has fallen to very attractive prices
3) RUBBER PRICES HAS SHOT UP FROM RM1.33 TO RM2.18 (UP 63%)
FGV HAS BOTH PALM OIL & RUBBER
4) LA NINA IS NOW ON GOING
With Major Floods in China, Korea, Japan, Vietnam, Greece, France, Italy, Mexico, The Philippines World Major Crops Have Been Wiped Out
In Brazil, Argentina & USA High Plains Drought have decimated harvest of soy bean, corn & wheat.
A WORLD WIDE SHORTAGE OF VEGETABLE OIL WILL NOW PUSH UP CORN OIL, SOYBEAN OIL, SUN FLOWER SEED OIL, RAPESEED OIL, COCONUT OIL - THUS LEADING TO HIGH PALM OIL PRICES
5) BY USA TRADE AGREEMENT CHINA IS BOUND TO BUY MORE SOY BEAN FROM USA
AND THIS IS AMPLIFIED BY THE FLOODS THAT WIPED OF SOY BEAN IN CHINA BREAD BASKET OF HEILONGJIANG BY 3 POWERFUL TYPHOONS THIS YEAR
6) LAST YEAR SWINE FEVER WIPED OFF CHINA SWINE HERD
Last year 200 Million Pigs were curled & destroyed because China had Swine Fever
So this year lots of corn meal & soy bean meal will be needed as feedstock to build up Swine Herd again
So demand for Soybean & corn can only increase
And Palm Kernal cakes also turn very popular as a feedstock
7) DELAY OF BRAZIL & ARGENTINA SOY CROP TILL FEB 2021 DUE TO HOT DRY WEATHER
As of end October 2020 due to persistently dry weather in Brazil & Argentina planting of Soybean is delayed due to lack of rain
So for next 3 months of November 2020 to February 2022 there won't be soybean (unless old stock) on earth
Palm oil is evergreen & harvest continue every two week a month or 26 weeks a year
When there is no competing Soybean Oil then Palm Oil will reign supreme
8) Just as China Got Crop Wipe Out....India Maharastha & Its Surrounding State producing Soybean also got Flood that wiped out its crops.
November 14 is Diwali in India or called Deepavali in Malaysia & Spore. Can expect a surge of palm oil usage as it is now very cheap compared to all other Vegetable Oils
9. For Malaysia there is palm oil export levy waiver till December 31st. Plus Budget also announced more incentive for both palm oil & rubber. This will boost the value & profit of all palm oil companies
10. ALL THESE ARE CONVERGING FACTORS WHY PALM OIL BULL RUN SHOULD SUSTAIN
AND IF LA NINA SMOTHERS THE SOYBEAN CROPS OF BRAZIL & ARGENTINA LIKE PAST YEARS THEN PALM OIL WILL GO UP IN A VERY STRONG BULL RUN JUST LIKE COVID 19 PROPEL GLOVE STOCKS TO MULTI YEAR HIGH
ONLY DIFFERENCE BETWEEN PALM OIL AND GLOVE ARE THEIR PRICES NOW
WHILE GLOVES HAVE GONE BY 1,000% PALM OIL STOCKS STILL REMAIN NEAR ROCK BOTTOM
Calvin Tan Research
All information provided here should be treated for informational purposes only. It is solely reflecting author's personal views and the author should not be held liable for any actions taken in reliance on information contained herein.
Coming up Next
Why is Syed Moktar interested in FGV?
And what is the book value of Felda lands given by Tunku Abdul Rahman beginning in year 1956?
Shocking revelation about its unbelievable book value prices.
FGV took over at minimal land value in year 2012? How much were the lands cost then & now?
These and more to come as we search for the next hidden gem
BELOW IS CPO DAILY CLOSING PRICES FOR OCT/NOV 2020
5 Nov 20 3208
4 Nov 20 3097
3 Nov 20 3070
2 Nov 20 2975
30 Oct 20 3011
28 Oct 20 3051
27 Oct 20 3065
26 Oct 20 3066
23 Oct 20 2942
22 Oct 20 2943