Broker Name: CGS International
Date of Report: March 2, 2026
Excerpt from CGS International report.
- First Resources Ltd (FR) reported FY25 core net profit of US\$358m, exceeding forecasts and resulting in a higher final dividend and an increased payout policy from 50% to 60% of underlying net profit from FY26 onwards.
- The acquisition of Austindo Nusantara Jaya is expected to boost yields and production in FY26, while strong downstream margins are supported by biodiesel allocation.
- Operational improvements and higher-yielding planting materials have driven increased production and yields; the company’s integrated operations provide flexibility to maintain profitability under varying market conditions.
- Some land issues have been partially resolved, though regulatory and weather-related risks in Indonesia remain potential challenges.
- FR is forecasted to deliver attractive dividend yields of 7-8% for FY26-28, and maintains a target price of S\$2.85 with an “Add” rating, citing strong cash flow, efficient cost management, and ongoing sustainability initiatives.
- ESG performance noted improvement, with reduction in emissions and increased RSPO certification, though some governance and transparency issues persist.
- The company benefits from robust free cash flow and improved balance sheet metrics post-acquisition, positioning it well against peers in the sector.
above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website : https://www.cgs-cimb.com
