by DBS Group (16 May)
3Q2008 earnings were slightly above expectations, rising by 39% y-o-y to $56m on revenue growth of 52% y-o-y to $2.4b. As at 9M2008, Olam's bottom line rose by 31% y-o-y to $103m, as top line expanded by 26% y-o-y to $3.8b.
The robust performance was led by broad based growth that saw both volumes and net contribution per tonne increase across all segments (excluding Queensland Cotton's results) on y-o-y. We raised out FY2008 earnings numbers by 6%, kept our FY2009 numbers and introduced FY2010 forecast.
Olam continues to execute well on its expansion strategy and deliver on earnings growth. Target price is based on 30 times FY2009 PER, predicated on one time PEG.
We are forecasting 31% EPS CAGR for Olam over FY2007-FY2010F.
-Research Report by DBS Group (16 May)
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