MBSB Investment Bank Bhd (MBSB Research) downgraded QL Resources Bhd to NEUTRAL from BUY with an unchanged target price of RM4.11, following the recent share price appreciation which the research house believes has priced in the company’s positive outlook. MBSB Research said its earnings forecasts and fundamental view remain unchanged, with QL’s diversified operations continuing to support its medium-term growth prospects.
The research house highlighted QL’s improving environmental, social and governance (ESG) disclosures after the company adopted the International Sustainability Standards Board’s IFRS S1 and S2 reporting standards for the first time in FY26. The group also referenced global frameworks including GRI Standards, SASB Standards, TCFD and the Malaysian Code on Corporate Governance.
MBSB Research said QL’s social contribution remains centred on affordable protein and child nutrition, supported by its integrated livestock farming, marine products manufacturing, convenience store and palm oil and clean energy segments. Under its C Our Future programme, QL delivered 95,940 eggs to 20 Tabikas benefiting 683 children in FY26, while recording a 29.7% reduction in underweight cases among measured children.
The research house also noted QL’s circular economy initiatives, including composting 135,194.98 tonnes of chicken manure into organic fertiliser and recovering 25,024.70 tonnes of fisheries waste into fishmeal. The group also increased solar energy consumption by 39.5% year-on-year and has committed to achieving Net Zero by 2050 across its Malaysia, Indonesia and Vietnam operations.
However, MBSB Research said QL continues to face environmental and social risks across its palm oil, marine and livestock businesses, particularly in traceability, biodiversity, labour standards and animal welfare disclosures.
The research house maintained its RM4.11 target price based on a 10-year multi-stage discounted cash flow model, saying QL’s long-term fundamentals remain supported by its diversified business portfolio despite the valuation-driven downgrade.
As of 10 am, the stock price gained 0.76% to RM3.97.
