► TA SECURITIES
A MEMBER OF THE TA GROUP
RESULTS UPDATE
Thursday, August 21, 2025
FBMKLCI: 1,588.21
Sector: Plantation
THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY*
TSH Resources Berhad: Still Providing Upside Potential
TP:
RM1.30 (+11.9%)
Last Traded:
RM1.16
Rating:
Review
- TSH’s 2QFY25 results exceeded expectations due to higher-than-expected margins. Excluding exceptional items, 2QFY25 core net profit increased by 40.2% YoY to RM53.1mn, supported by a 6.4% rise in revenue.
- In 1HFY25, core net profit climbed to RM106.2mn, accounting for 77% of both ours and consensus’ full-year estimates, while revenue increased 9.9% YoY to RM544.1mn.
- Palm Product: Despite a flat FFB production growth, 1HFY25 operating profit rose 53.5% YoY to RM161.8mn, driven by stronger palm oil prices. The average CPO price increased 7.9% YoY to RM3,932/tonne, while the PK price surged 56.2% YoY to RM3,261/tonne.
- Non-palm commodity: For 1HFY25, operating losses widened 30.8% YoY to RM7.3mn, largely attributable to weaker revenue and inventory write-downs in the Wood segment for slow-moving stock.
- No dividend was declared for the quarter under review.
Share Information
| Bloomberg Code | TSH MK |
| Stock Code | 9059 |
| Listing | Main Market |
| Share Cap (mn) | 1380.7 |
| Market Cap (RMmn) | 1,601.6 |
| 52-wk Hi/Lo (RM) | 1.28/1.0 |
| 12-mth Avg Daily Vol (‘000 shrs) | 1504.4 |
| Estimated Free Float (%) | 26.3 |
| Beta vs. FBMKLCI | 1 |
| Major Shareholders (%) | |
| Tan Aik Pen | 27.4% |
| Central Depository | 18.7% |
| Tan Aik Yong | 5.5% |
Forecast Revision
| FY25 | FY26 | |
|---|---|---|
| Forecast Revision (%) | 31.4 | 22.3 |
| Net profit (RMm) | 181 | 149 |
| Consensus | 138 | 132 |
| TA’s / Consensus (%) | 131 | 113 |
| Previous Rating | Hold (Upgrade) | |
| Consensus Target Price (RM) | 1.24 | |
Financial Indicators
| FY25 | FY26 | |
|---|---|---|
| Net Debt / Equity (%) | (10.3) | (13.6) |
| CFPS (sen) | 14.4 | 3.6 |
| Price / CFPS (x) | 8.1 | 32.6 |
| ROE (%) | 8.7 | 6.8 |
| ROA (%) | 6.3 | 5.0 |
| NTA/Share (RM) | 1.8 | 1.9 |
| Price/NTA (x) | 0.7 | 0.6 |
Impact
- We revise our FY25 and FY26 earnings forecasts upwards by 31.4% and 22.3%, respectively, after factoring in improved margins and lower finance cost. We also introduced our FY27 profit forecast of RM146.4mn.
Outlook
- Despite external challenges, management remains positive on its long-term outlook. The group is also expanding planted hectarage to boost future productivity and shareholder value.
- We anticipate CPO prices may face downward pressure if a U.S.-China soybean sales agreement is not concluded before the late September. Such an outcome could trigger weaker export demand, inventory build-up, and further softness in soybean prices.
- In our view, a prolonged and substantial decline in soybean prices would inevitably weigh on CPO, as a narrower soybean oil premium would erode palm oil’s relative cost advantage and competitiveness in key markets. Given the strong correlation between both oils within the global vegetable oils complex, sustained weakness in soybeans could pose significant headwinds for CPO.
Scorecards
| % of FY | |
|---|---|
| vs TA | 77 |
| vs Consensus | 77 |
Above
Above
Share Performance (%)
| Price Change | TSH | FBM KLCI |
|---|---|---|
| 1 mth | 0.9 | 4.2 |
| 3 mth | 4.5 | 2.8 |
| 6 mth | (3.3) | (0.2) |
| 12 mth | 1.8 | (2.9) |
(12-Mth) Share Price relative to the FBMKLCI
Chart Placeholder (No images allowed)
390004420 7330 750049 69 9204 1210 Hang Keng
Source: oomberg
Valuation
- We raise TSH’s target price to RM1.30, based on a CY26 PER of 12x. The stock is offering an attractive capital gain thus we upgrade our recommendation to BUY from Hold.
Figure 1: FFB Production (Tonne)
FFB Production Chart Placeholder (No images allowed)
300,000
250,000
200,000
150,000
100,000
50,000
0
1QFY13 4QFY13 3QFY14 2QFY15 1QFY16 4QFY16 3QFY17 2QFY18 1QFY19 4QFY19 3QFY20 2QFY21 1QFY22 4QFY22 3QFY23 2QFY24 1QFY25
Source: Company, TA Research
2QFY25 Results Analysis (RMmn)
| FYE Dec (RMmn) | 2QFY24 | 1QFY25 | 2QFY25 | QoQ (%) | YoY (%) | 1HFY24 | 1HFY25 | YoY(%) |
|---|---|---|---|---|---|---|---|---|
| Revenue | 252.5 | 275.3 | 268.8 | (2.4) | 6.4 | 494.9 | 544.1 | 9.9 |
| EBIT | 30.1 | 73.4 | 64.1 | (12.7) | >100 | 64.7 | 137.5 | >100 |
| Net interest | (0.1) | 1.5 | 2.2 | 41.6 | nm | (0.6) | 3.7 | nm |
| Associates & JV | 6.0 | 3.7 | 5.1 | 37.7 | (14.8) | 6.8 | 8.8 | 28.8 |
| EI & Forex | (17.2) | (4.9) | (3.9) | nm | (77.6) | (19.8) | (8.8) | (55.5) |
| PBT | 35.9 | 78.6 | 71.4 | (9.3) | 98.5 | 71.0 | 150.0 | >100 |
| Tax | (10.6) | (20.9) | (15.0) | 27.9 | (41.4) | (20.5) | (35.9) | (75.2) |
| MI | (4.7) | (9.6) | (7.1) | 26.0 | (51.7) | (9.8) | (16.7) | (70.6) |
| Net Profit | 20.6 | 48.2 | 49.2 | 2.1 | >100 | 40.7 | 97.4 | >100 |
| Core Net Profit | 37.8 | 53.1 | 53.1 | (0.1) | 40.2 | 60.5 | 106.2 | 75.7 |
| EPS (sen) | 2.7 | 3.8 | 3.8 | 4.4 | 7.7 | |||
| DPS (sen) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||
| EBIT Margin (%) | 11.9 | 26.7 | 23.9 | 13.1 | 25.3 | |||
| Core Net Profit Margin (%) | 15.0 | 19.3 | 19.7 | 12.2 | 19.5 | |||
| Tax rate | 29.6 | 26.5 | 21.1 | 28.9 | 23.9 | |||
Earnings Summary
| FYE Dec 31 (RM mn) | FY23 | FY24 | FY25F | FY26F | FY27F | |
|---|---|---|---|---|---|---|
| Revenue | 1066.5 | 1019.8 | 1060.5 | 1026.0 | 1029.1 | |
| EBITDA | 347.8 | 372.0 | 369.0 | 284.1 | 266.0 | |
| EBITDA margin | (%) | 32.6 | 36.5 | 34.8 | 27.7 | 25.8 |
| Pretax profit | 197.8 | 221.3 | 291.6 | 240.9 | 236.1 | |
| Reported Net Profit | 95.1 | 140.5 | 180.9 | 149.4 | 146.4 | |
| Core Net Profit | 77.4 | 126.9 | 180.9 | 149.4 | 146.4 | |
| Reported EPS | (sen) | 6.9 | 9.2 | 13.1 | 10.8 | 10.6 |
| Core EPS (diluted) | (sen) | 5.6 | 9.2 | 13.1 | 10.8 | 10.6 |
| Core EPS growth | (%) | (57.2) | 63.9 | 42.5 | (17.4) | (2.0) |
| PER | (x) | 20.7 | 12.6 | 8.9 | 10.7 | 10.9 |
| GDPS | (sen) | 2.5 | 2.5 | 4.0 | 3.0 | 3.0 |
| Div yield | (%) | 2.2 | 2.2 | 3.4 | 2.6 | 2.6 |
| Core ROE | (%) | 3.9 | 6.3 | 8.7 | 6.8 | 6.3 |
