Why? EPF has been purchasing large number of shares of Felda Global Ventures Holdings

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Amid criticisms that Employees Provident Fund has been purchasing large number of shares of Felda Global Ventures Holdings amid their steady decline since last week, the pension body has defended its action it was just taking “forward looking” approach by buying low-priced stocks in a sector which it said has ups and downs.

“Our current buyings are mostly forward looking and we are taking the current opportunity of weak prices of CPO and high stockpile to position ourselves for the future,” EPF in a statement.

But the explanation did not go down well with PAS research chief Dr Dzulkefly Ahmad, who asked whether the body, which is tasked with collecting compulsory monthly contributions from employers and employees nationwide, was doing a “national service” for the BN government.

“While I am elated as a contributor to know that EPF has been wisely managing my pension funds by following the cardinal principle of investment that is ‘buy low, sell high’, I would like to ask this biggest fund manager of this country, until when will it continue with the buying (of FGVH shares),” asked Dzulkefly in his reaction.

He noted that as a core investor, EPF’s share in FGVH has increased from 5.07 per cent in July to 7.02 per cent. But he said FGVH’s share value was weaker compared to that of Sime Darby or KL Kepong, whose share price respectively dropped 1% and 4% respectively since July, as opposed to FGVH which saw its share price declining by 12%.

Dzulkefly also pointed out that the plantation holdings had registered a decrease of profit by 32.5% compared to the previous year, and reminded that more than half of its palm trees were ageing.

“Taking into account these external and internal risk assessments as well as its projected cash flows, (EPF) contributors would like to know the rationale behind its strategic calculations, as well as the reason why EPF’s investment panel has continued to buy FGVH shares, while presumably, doing its ‘national service’ as instructed by UMNO-BN political masters,” stressed Dzulkefly. – Harakah