TA sees KL Kepong a buy at RM16.50

TA Securities has recommended a "buy" call on KL Kepong and raised the target price on the stock to RM16.50.

KL Kepong is scheduled to release its Q4 2009 result on November 24. "We expect the full year results to be within ours and consensus expectations," said TA.

TA estimated KL Kepong's core net profit to be RM664.7 million, a 42 per cent drop from the previous year's record earnings due to lower net profit across all the core business segments.

"We adjusted upward target price RM16.50 based on Sum-of-Parts valuation methodology," TA said.

"We continue to like KL Kepong as a proxy to CPO price which should benefit from continued tight supply-demand balance until H2 CY 2010," it added. - Reuters