KUALA LUMPUR (Nov 20): Kuala Lumpur Kepong Bhd's (KLK) share price rose as much as 70 sen or 3.11% to RM23.20 in morning trades today after the plantation company reported yesterday that fourth quarter net profit climbed to RM175.02 million from RM127.99 million in the year-ago period.

At 11.59am, the stock was traded at RM23.10, making it the top gainer across Bursa Malaysia. The counter saw 1.12 million shares transacted.

KLK said net profit for the fourth quarter ended Sept 30, 2019 (4QFY19) led to a higher full-year (FY19) net profit of RM617.51 million versus RM609.37 million a year earlier.

Today, analysts raised their KLK earnings forecast and upgraded their target prices (TPs) and recommendations for KLK shares. They said KLK's FY19 core net profit was within market expectation.

"KLK's FY19 core net profit of RM656.5 million (-20.4% y-o-y) came in largely within our expectations," Affin Hwang Investment Bank Bhd analyst Nadia Aquidah wrote in a note today.

Nadia said lower profit was seen at KLK's plantation division due to weaker crude palm oil and palm kernel prices, both of which negated higher earnings in the manufacturing, property and investment holding segments.

"After a weak FY19 performance, we expect KLK's FY20-22E earnings to be stronger on the back of higher CPO (crude palm oil) prices (CPO price assumption raised to RM2,450-2,600/MT). After our upward earnings forecast revisions by 10.2%/9.1% for FY20E/FY21E, we raise our discounted cash flow-derived TP to RM26 from RM24. Given the potential upside of 15.6% to our new TP, we upgrade KLK to BUY from Hold," she said.

Credit Suisse has also upgraded KLK. Bloomberg reported that Credit Suisse analyst Amanda Foo raised the recommendation on KLK shares to outperform from neutral.

It was reported that Credit Suisse set its KLK TP at RM26.10.

"Analysts raised their consensus one-year target price for the stock by 2.2% in the past three months. Targets range from RM18.78 to RM26.25," Bloomberg reported.