SD Guthrie: Bolstered by Land Disposal in Kulai (SDPL MK, Outperform, TP: RM7.81)

SD Guthrie reported 1HFY26 core profit of RM1.5bn (+44% YoY), making up 61% and 63% of our and the street’s full-year expectations, respectively. Despite weaker performance from all the upstream segments, the downstream outperformed with strong earnings growth of 21.3% YoY.

The Group also recognised a total land sale gain of RM689m from the sale of 935 acres of land in the Group’s Kulai estate, Johor, as well as gains from other outright third-party land sale deals.

“We raise our FY26-28F earnings forecast by 8-20% to reflect a higher CPO price assumption of RM4,500/mt and an estimated net gain of RM408m from the recent land sale transaction in Bukit Kerayong, Kuala Selangor,” says PIB.

Separately, the Group has entered into a conditional sale and purchase agreement with Sime Darby Property involving the disposal of freehold land with a total land area of 556.96 acres in Kulai, Johor for a total cash consideration of RM418.5m, which would rake in a net gain of RM373m in 2QFY27F.

Analysts maintain Outperform callwith a higher TP of RM7.81 based on 20x FY27 EPS. A first DPS of 11.18sen (vs 1QFY25: 7.75sen) was declared for the quarter. 

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