KUALA LUMPUR (Feb 18): Kuala Lumpur Kepong Bhd (KLK) emerged as one of the top gainers in the local bourse on Friday (Feb 18) after its share price hit an all-time high as the asking price of crude palm oil (CPO) futures topped RM6,000 a tonne for the first time on Thursday (Feb 17) at RM6,050.

The stock opened 60 sen or 2.33% higher to RM26.40 and surged further to hit an intraday high of RM26.70.

The counter then traded 58 sen or 2.25% higher to RM26.38 at the time of writing. 

At RM26.38, the stock is valued at RM28.52 billion. 

It saw a total of 2.9 million shares changing hands, more than four times its 200-day trading volume average of 772,152 shares.

Meanwhile, in a research note on Wednesday (Feb 16), Hong Leong Investment Bank’s (HLIB) analyst Chye Wen Fei said the research house is “overweight” on the plantation sector, believing that the CPO price will likely remain at elevated levels in the next few months.

Chye has also raised her 2022-2024 CPO price forecast to RM4,300, RM3,300 and RM3,300 per tonne, from RM3,500, RM2,900 and RM2,900 per tonne previously.

“CPO price will likely remain at elevated levels in the next few months (possibly until 1H22), supported by weaker production outlook for corn and soybean in South America, and Indonesian government’s recent move to expand its export permit requirement for all palm oil products, which will likely disrupt palm oil supply chain,” Chye wrote.

Public Investment Bank Bhd, on the other hand, said the palm oil industry witnessed an unprecedented supercycle with CPO futures topping RM6,000 a tonne on Thursday for the first time. 

"We turn bullish on the sector as we expect a strong earnings trajectory for the plantation companies. We think CPO prices will remain strong in the first half of 2022 given the tight global vegetable oil supplies and also supply constraints for palm oil in the top two producing countries. 

"Hence, we revise up our CPO price assumption from RM3,500/tonne to RM4,300/tonne and RM3,800/tonne for 2022 and 2023, respectively,” Public Investment Bank Bhd analyst Chong Hoe Leong said in a note on Friday.