Download Report Here (PDF) Key Findings Indonesia’s proposed palm oil moratorium combined with buyers’ No Deforestation, No Peat, No Exploitation (NDPE) policies impacts industry growth potential. Within current concession areas, the moratorium adds regulatory risks to market access risks for companies that proceed with developing forests or peatland. Outside these existing concession areas, there is …
Download Report Here Summary 6.1 million ha of forests and peatland are “stranded assets” on the balance sheet of Indonesian palm oil companies as they cannot viably be developed. 95 identified palm oil company groups – 35 of which are publicly traded – each holds at least 1,000 ha of stranded land within their concessions. …
Download Report Here (PDF) PT Indofood Sukses Makmur Tbk. (Indofood SM), listed on the Indonesia Stock Exchange, is the country’s largest food company and the market leader in instant noodles, flour, cooking oils, margarine and fats. Its largest shareholder is First Pacific Co. Ltd., a Hong Kong-listed conglomerate with interests in food, telecom, construction, and …
Download Report Here (PDF) Summary 42 percent of Indofood Agri’s 549,287 ha total landbank is contested. Contested landbank and alleged labor risks could have material impact on equity price. At least 36 percent of the CPO processed in Indofood Agri’s refineries comes from undisclosed sources. A RSPO complaint was recently filed accusing Indofood Agri of …
Download Report Here (PDF) Summary The 16 selected large oil palm growers and traders attracted more loans per year in the period from 2006-2015 and issued more bonds. SE Asia banks are the most important lenders to these palm oil companies. Loans are becoming more important than bonds over time. Stronger bank ESG policies the …
Download Report Here (PDF) Summary The sustainable purchasing policies of main traders/processors have strengthened the sustainability policies and practices of 4 of the 10 largest palm oil growers listed on the Indonesian stock exchange (IDX). Most of the IDX-listed palm oil growers still have poor sustainability standards. The IDX-listed palm oil growing companies PT Tunas …
Download Report Here (PDF) Summary Management can mitigate financial risks by pursuing outgrower model. Converting complete 220,000 ha concession brings significant political, reputational, and financial risks. Outgrower model has short-term equity downside with long-term value proposition. (This stock trades with much greater liquidity on the Bursa Malaysia under ticker SIME) Sime Darby (OTCPK:SMEBF) (SIME:MK), a …
Download Report Here (PDF) Summary Operational Risks: Hazards to investments can threaten the economic viability of projects when key risk management lessons are not applied in frontier markets. Stranded Assets Risk: Contested land bank reduces future growth and impacts investor value. Financial Risks: Failure to obtain free, prior, and informed consent (FPIC) from local communities …
Download Report Here (PDF) Summary Forecast of 2016 revenue is $46 billion, 30% below 2015, due to poor semi-annual performance and asset sell down strategy. 33% of Noble’s palm oil landbank is undevelopable as it is primary forest and possibly peat. Impairments of palm oil assets and coal receivables may reduce balance sheet equity value …
Download Report Here (PDF) Summary Deforestation risks material to financial institutions. Key economic sectors exposed to deforestation-related financial risks. Agriculture, mining, oil and gas, and infrastructure sectors impacted. The economic links between deforestation and climate change are increasingly recognized in, for example, the 2015 Framework Convention on Climate Change’s Paris Agreement and elsewhere. This recognition …
