But ... what will be the impact to the Plantation Stocks? Positive or Negative?
Well .... no dought escalation of "wage" is negative for bottomlines of all plantation companies, as they are in a labour intensive industry.
However the impact of wage hike to "plantation stocks" is the diffrence between "expected wage hike" and "actual wage hike". Becouse the stock prices have already been adjusted for expected wage hike.
Actual wage hike is about 20% (will revise at the end of two years term -in 2013)
then ... what was the expected wage hike ?? 5%, 10%, 15%, 20%, 25% or 30% ....
If the expected rate was lesser than 20%, we can expect negative impact to stock prices, But the actual rate is par with the actual 20% or higher than that (pls note this wage hike is for 2 years period untill 2013) the impact should be Positive ..
What was your expectation ??