President SBY just announced the ministers for the period of 2009-2014. I noticed that the economic coordinator minister, Hatta Radjasa might be the weakest person in the economic team. Lets look at the market reaction tomorrow...
By the way, the oil price has reached a new high today at around $81 per barrel. I believe with the upward move in the oil would influence other commodity prices such as crude palm oil (CPO). If you guys are following me, I wrote in my comment here: http://deroncapital.files.wordpress.com/2009/09/factsheet-sep-092.gif
On that comment, I have predicted that CPO price tend to be higher in the coming months. In early October I bought SGRO stock to overweight the plantation sector in my portfolio which had gained almost 20% before I sold it. You guys could check my portfolio here : http://deroncapital.wordpress.com/
SGRO, AALI and LSIP are outperforming the market month to date. UNSP is lagging the market. I believe UNSP would rise in the near to medium term to catch the other plantation stocks.
The 2Q-2009 UNSP financial report showed some sign of improvement, even though the market still think that UNSP is a risky kind of stock which is reflected on its stock price, with P/BV below 1.5 x. If you check the financial statement, obviously the profit were resulted in the April-June period. From here, I concluded that the trend is improving.
(Source : Dongsuh Securities, edited)
The thing that we should be aware of is the BV per share of UNSP is significantly lower than three months ago due to the increasing in the diluted weighted average share. I am expecting that when the CPO price increasing significantly, UNSP management would be able to buy back some of its stock in the market hence the outstanding share would be reduced.
I believe the ideal P/BV ratio of UNSP should be around 1.7-1.8 x, given its strong growth potential. I derived the ideal price of UNSP based on its ideal P/BV :
| P/BV | Expected Price |
| 1.7 | 961.32 |
| 1.8 | 1017.87 |
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