KUALA LUMPUR (Dec 4): CIMB Research has maintained its “Hold” rating on Jaya Tiasa Holdings Bhd at RM1.94 with a lower target price of RM1.95 (from RM2.15) and said its checks with Jaya Tiasa revealed that the group’s log production cost fell in 1QFY6/15, mainly due to lower transportation cost.

In a note Dec, CIMB Research said Jaya Tiasa’s log production cost may remain low in 2QFY15 but was expected to rise in 2015, when its harvesting area shifts to the more remote parts of its concessions.

The research house said this was in line with its projection that Jaya Tiasa’s  average log production cost in FY15 would be higher than in 1QFY15.

“We make no changes to our FY15-17 EPS and Hold recommendation.

“However, our target price falls to RM1.95, as we apply a 10% discount to our SOP valuation for the worsening CPO price sentiment due to the sharp fall in crude oil price.

“Switch to First Resources for exposure to plantations,” it said.