MHC PLANTATIONS BHD (MHC)

MHC Plantations Bhd - A 65-Year Family Plantation Story, Quietly Profitable

If you are searching for an under-the-radar plantation company with a proven track record of consistent profitability spanning decades, MHC Plantations Bhd (Bursa: 5026) deserves a place on your watchlist. Founded in 1960 as "Mah Hock Cheong Company Limited" - before Malaysia's independence - MHC has quietly grown into a RM 308 million market cap company that continues to reward shareholders through dividends while most investors have never heard of it.

Headquartered in Teluk Intan, Perak, MHC Plantations sits in the mid-size plantation space with 196.54 million shares outstanding and a management philosophy that prioritises operational efficiency over flashy expansions. Unlike plantation giants such as IOI Corp or Sime Darby Plantation, MHC has no ambitions to become a multinational conglomerate. It does what it knows best: grow oil palm, process it into CPO and CPKO, and run the operation as profitably as possible.

✅ Shariah Compliant Status

MHC Plantations is certified Shariah-compliant by the Shariah Advisory Council of the Securities Commission Malaysia. Muslim investors can invest in this stock without concerns regarding religious compliance.

Business Segments

MHC operates through four complementary business segments that form a well-integrated value chain:

Segment	Core Activities	Contribution
Plantation	Oil palm cultivation, Fresh Fruit Bunch (FFB) production	Primary raw material source
Oil Mill	FFB processing into Crude Palm Oil (CPO) and Crude Palm Kernel Oil (CPKO)	Highest revenue contributor
Biomass Power Plant	Electricity generation from palm waste (fronds, shells, fibres)	Green energy supplementary income
Others	Anson Hotel (7-storey, Teluk Intan), investment holdings, quarry operations	Diversified income streams

The business model demonstrates intelligent vertical integration. MHC grows its own oil palm, processes it in-house at its own mill, and even converts agricultural waste into electricity via its biomass power plant. This structure keeps value within the corporate ecosystem and allows cost optimisation across the entire production chain.

Financial Snapshot

For FY2025 (year ended December 2025), MHC delivered:

• 📈 Revenue: RM 550.3 million (up 9.3% from RM 503.7 million in FY2024)
• 📈 Net Profit: RM 48.8 million (up 18.7%)
• 📈 EPS: 24.80 sen (vs ~14.62 sen FY2024, a jump of +69.6%)
• 💰 Dividend: ~25 sen/share total (including special dividend), representing ~15.92% yield at current price

At the current price of RM 1.57 (May 2026), MHC trades at a 16.5% discount to its Net Tangible Assets (NTA) of RM 1.88 per share. With a P/E ratio of just 6.33x, the stock appears significantly undervalued compared to sector peers.

Market Positioning

MHC fits the definition of an "orphan stock" - a company that receives no analyst coverage, is ignored by institutional investors, and rarely appears in financial media. Daily trading volume averages only around 162,600 shares, making it highly illiquid by market standards. This creates a dual dynamic: the stock may be mispriced (offering opportunity), but exiting a large position could be challenging and time-consuming.

MHC's Q2 FY2026 (quarter ended 30 June 2026, announced 20 Aug 2026) shows revenue still growing (+4.2% YoY to RM151.9 million) but profit margins compressing — PBT is estimated at RM20.3-20.4 million (13.4% margin) versus RM23.1 million a year earlier, a decline of roughly 11.6% YoY. Net profit to shareholders of RM10.26 million (EPS 5.22 sen) fell about 12.3% YoY. Some data providers display a headline "+11.6% YoY" growth figure for this quarter — after cross-checking, that figure actually represents an 11.6% PBT DECLINE, not growth. Automated headline numbers like this need to be treated with caution.

Quarter	Revenue (RM'000)	PBT (RM'000)	NP to Shareholders (RM'000)	EPS (sen)	Net Margin
Q2 FY2026 (30 Jun 26)	151,940	~20,360	10,260	5.22	6.75%
Q1 FY2026 (31 Mar 26)	123,316	19,882	11,605	5.90	9.41%
Q4 FY2025 (31 Dec 25)	142,608	25,371	11,343	5.77	7.95%
Q3 FY2025 (30 Sep 25)	142,729	23,108	15,851	8.06	11.11%
Q2 FY2025 (30 Jun 25)	145,810	23,064	11,700	5.95	8.03%
Q1 FY2025 (31 Mar 25)	119,122	16,722	9,871	5.02	8.29%

The balance sheet remains very strong — net cash of roughly RM385.7 million, almost matching the RM383.3 million market cap.

This is the main reason MHC is back in the spotlight: the company just declared a 10 sen special dividend per share (ex-date 14 Sep 2026, payment date 28 Sep 2026), announced via a Notice of Book Closure on 1-2 Sep 2026. At the current price of RM1.95, the trailing 12-month dividend (25 sen — ex-date 13 Mar 2026, a combined 3.0 sen FY2026 interim + 22.0 sen FY2025 special) works out to a trailing yield of roughly 12.8%. Once this new 10 sen special dividend goes ex, the trailing 12-month yield steps up to roughly 17.9% (35 sen / RM1.95) — among the highest of any Bursa Malaysia plantation counter.

Ex-Date	Type	Amount	Pay Date
17 Apr 2025	FY2024 final dividend + FY2024 special dividend	9.0 sen	7 May 2025
13 Mar 2026	FY2026 interim dividend + FY2025 special dividend	25.0 sen (3.0 + 22.0)	27 Mar 2026
14 Sep 2026 (NEW)	Special dividend (tied to H1 FY2026 performance)	10.0 sen	28 Sep 2026