KUALA LUMPUR (Sept 7): Palm oil related stocks such as Sime Darby Bhd, Kuala Lumpur Kepong Bhd (KLK) and Genting Plantations Bhd were on a downward trend this morning, in anticipation of a weaker set of palm oil statistics from the Malaysian Palm Oil Board (MPOB).

An analyst with BIMB Securities Bhd attributed the decrease in the palm oil related stocks to the upcoming release of MPOB data, which is expected to be out this week, that may indicate lower exports as a result of weak global demand for palm oil.

“Another factor that has brought about the weak sentiment in palm oil related counters is India, which has plans to spend US$1.5 billion in the next three years to help its farmers grow palm oil, which seems like a threat to Malaysia and Indonesia, considering India is one of the main importers of palm oil,” said the analyst.

Last Friday (Sept 4), Moody's Investors Service affirmed the A3 issuer and A3 senior unsecured debt ratings assigned to Sime Darby, as well as its (P)A3 senior unsecured MTN programme rating, with a negative outlook. The sukuk was issued by Sime Darby's wholly-owned subsidiary, Sime Darby Global Bhd.

At noon market close today, Sime Darby (fundamental: 0.8; valuation: 1.4)'s shares were down 18 sen or 2.4% to RM7.37, with 1.59 million shares traded, and was among top losers on Bursa Malaysia.

KLK (fundamental: 1; valuation: 1.1) closed 12 sen or 0.57% lower at RM20.80 at noon, with 156,200 shares having changed hands; while Genting Plantations(fundamental: 2.7; valuation: 0.8) was down 13 sen or 1.31% to RM9.83, with 104,000 shares traded.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)