A strong recovery from 2Q17but insufficient to excite investors, in our view    We maintain our Hold rating on Wilmar (WIL) because    (1) its trading nature isunlikely to attract new investors to lift share price and    (2) lack of long termstructural catalysts to offset investors’ perception of its trading nature. But wedo acknowledge Wilmar has stood out as the most well managed trading firmamongst its peers. Its consistent US$1bn net profit mark is substantially betterrelative to peers. Strategic investors like ADM have invested constantly at theS$3level offsetting Martua’s sell down, thus offering downside support.    Low predictability means expectations are likely to be generally wrong    3Q17core profit jumped 8-fold QoQ to US$324mn, lifting 9M17core profit by74% to US$674mn. 9M17core profit is 68% of ours and consensus forecast,suggesting market has got it wrong again. Given WIL’s trading nature, it ismore important to study historical trends than make forecasts. However, WILmerged four segments’ PBT into two in its 1Q15results, making it moredifficult to analyze already unclear financials. Moreover, WIL trading positionsare proprietary information which makes access impossible too.

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