Asian Century Stocks

Share this post

Deep-dive 2021-10: United Plantations

www.asiancenturystocks.com
Deep-dives

Deep-dive 2021-10: United Plantations

Michael Fritzell
May 16, 2021
4
9
Share this post

Deep-dive 2021-10: United Plantations

www.asiancenturystocks.com

United Plantations (UPL MK) is one of the best-managed oil palm plantation companies in the world.

With most of its estates in the Malaysian state of Perak, United Plantations has production yields per tonne far above its Malaysian peers. And thanks to vertical integration, it has become a low-cost producer with cost per tonne at the lower end of the industry. Operational excellence has enabled United Plantations to earn a 30%+ operating margin in most of its recent history.

The company’s corporate governance track record and sustainability ratings are excellent. Few related party transactions, limited M&A, stable share count and a generous dividend policy.

Real assets tend to serve as inflation hedges during periods of high inflation. Judging from money supply indicators, budget deficits across the world and earnings call commentary, it looks like inflation pressures are building yet again. Plantation companies should help preserve purchasing power just as well as any other real ass…

This post is for paid subscribers

Already a paid subscriber? Sign in
Previous
Next
© 2023 Delante Media Pte Ltd
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing