Viet Dragon Securities - Analyst Pin-board Downtrend of palm oil price in 2H2022 supporting margins of edible oil producers

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Viet Dragon Securities

Son Tran

Analyst Pin-board Downtrend of palm oil price in 2H2022 supporting margins of edible oil producers

· According to CGS CIMB the crude palm oil (CPO) price is expected to be in a downtrend in 2H2022 due to improved global palm oil supplies. The CPO price has decreased in the beginning of June 2022 after Indonesia resumed palm oil exports in the end of May. On 17th June 2022, the CPO price was MYR 5,454 per ton (-10.8% MoM; +59.3% YoY).

· We believe that Vietnam edible oil producers will have the opportunity to purchase raw palm oil at a lower price compared to the 1H2022 level. Accordingly, the profit margins of Vietnam edible oil producers will start to recover in 2H2022.

· According to Kantar Worldpanel, one of the most prominent consumption trends across edible the oil industry during 2021 in Vietnam is the increasing consumer interest in premium edible oil after the Covid-19 pandemic. The higher contribution from premium segment will help to boost sales of edible oil producers.

· In Vietnam, Kido Group is the parent of the three Vietnam leading cooking oil producers. As a result, we believe that KDC will capture the growing edible oil sales value.

20/06/2022 7 EN

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Viet Dragon Securities

Viet Dragon Securities belongs to top 20 biggest securities companies in terms of chartered capital in Vietnam. With a qualified, dedicated and professional team, a widespread network, advanced technology, diversified products and services, and good relationship with local and foreign institutions, we provide a wide range of services and products to our clients both individuals and institutions, both local and foreign. We commit to provide our clients with promising investment opportunities and a comprehensive and professional financial investment services.

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Analysts

Son Tran

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Analyst Pin-board Downtrend of palm oil price in 2H2022 supporting margins of edible oil producers

Week Ends in Green

DPR – Compensation from Tien Hung 2 drives strong Q2 profit growth

Fertilizer industry – Big players looking to expand NPK share as Urea market saturates

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