SECTOR P.E. - 12.50
MARKET P.E. - 17.75
Plantation companies in the Colombo Stock Exchange are mostly undervalued at present. Specially if you take past couple of months, Plantation companies as a Sector substantially under performed to the Overall market.
WHY PLANTATION SECTOR IS NOT ATTRACTIVE ?
- High Cost of Sales [ Labour cost,Fertilizer cost. etc]
- Volatility in Commodity prices in the market.
- Unpredictable weather conditions.
WHY PLANTATIONS ARE ATTRACTIVE NOW?
- Increasing Oil prices in the world market paved the way to increase the demand for Natural Rubber Products & Palm Oil products.
- Commodity prices are on the rebound presently.
- Most of Plantation companies are diversified.
- Sector which is substantially under performed to the market.
- Most of other sectors in the Colombo Stock Market are over heated now.
- Best strategy is to move away from heated speculative counters & to invest in plantations.
- Most of the share prices of other companies in the Colombo Stock Market are @ their highest levels reported for the past 5 to 7 years. But not the Plantations.
There are 18 plantation companies listed in Colombo Stock Market up to now.
Main income generating crops are
- 0il palm
* Hydro power * Tourism * Forestry *Investments *Other cultivations [Coconut, Perennial crops etc.]
Note - * December Companies +
* Profits including all other details of HORANA & WATAWALA Plantations were as at 31/12/09
BEST BETS IN THE MARKET
- Balangoda Plantation
- Malwatte Plantation
- Watawala Plantation
- Kotagala Plantation
- Kelani Valley