This article first appeared in The Edge Malaysia Weekly on December 15, 2025 - December 21, 2025

GAINS from land sales will be a recurring feature at SD Guthrie Bhd (KL:SDG), though not in the fashion typically seen among plantation companies.

With more than 340,000ha across Malaysia, the group has earmarked significant tracts for steady annual monetisation. Group managing director Datuk Mohamad Helmy Othman Basha says SD Guthrie aims to monetise about 1,000ha a year, which would translate into RM500 million to RM700 million in annual earnings.

Such contributions, he notes, could lift the group’s steady-state full-year net profit to about RM3 billion. By comparison, SD Guthrie’s net profit in recent years has hovered around RM2 billion.

Crucially, the group’s monetisation strategy avoids outright disposals. Instead, land parcels will be injected into joint ventures (JVs) in which SD Guthrie retains what Mohamad Helmy describes as a “strategic minority” of at least 20%.

A clear example is its industrial park partnership with Eco World Development Group Bhd (KL:ECOWLD) and Negeri Sembilan state agency NS Corporation, via joint venture (JV) Eco Business Park 7 Sdn Bhd, in which SD Guthrie holds 30% interest.

In the third quarter ended Sept 30, 2025 (3QFY2025), SD Guthrie posted a net profit of RM935 million — 22% higher than a year earlier — supported by RM435 million in gains from its share of a 1,195-acre land sale in Port Dickson to the JV. The strong quarter lifted nine-month net profit to RM2.01 billion, putting the group on track for a record full-year performance.

More similar arrangements are underway. Its latest venture is with Eco World and Johor state-owned Permodalan Darul Ta’zim Bhd, involving the sale of 941.82 acres in Kulai to Eco Business Park 8 Sdn Bhd (EBP8), in which SD Guthrie owns a 45% stake.

Beyond the initial disposal gains, SD Guthrie’s equity participation ensures continued exposure to development upside and future land value appreciation. The group also expects surrounding land that it owns to benefit as new infrastructure is built to support the industrial park.

“Can you imagine the value creation we are making on this basis? This is the game that we, and maybe the market, are a bit excited about right now,” says Mohamad Helmy.

Retaining a stake also gives the group flexibility to manage existing oil palm trees on the land during phased development. “You don’t have to cut down all the palms; the development will take time. I can still maintain and generate income from the palms, so I win both ways,” he adds. “This is the best model; that’s why we are going after this.”

SD Guthrie, together with fellow listed plantation giants Kuala Lumpur Kepong Bhd (KL:KLK) and IOI Corp Bhd (KL:IOICORP), dominates Malaysia’s plantation scene.

While KLK has an integrated property arm, SD Guthrie parted ways with its sister property arm, Sime Darby Property Bhd (KL:SIMEPROP), as a result of the 2017 demerger from Sime Darby Bhd (KL:SIME).

“It’s a very specific mandate because we don’t want to go into commercial or housing. This is purely industrial parks.

“The model is different — we’re not doing it ourselves. We will leverage existing, established developers. That’s why we signed with Eco World. We signed with Sime Darby Property as well. There’ll be a few more in the pipeline,” says Mohamad Helmy.

As the largest landowner in several states, SD Guthrie has ample room to plan its monetisation rollout. “This year, Negeri Sembilan; next year is Johor; the year after, it could be Selangor or whatever else,” he notes.

“We can work with whoever. But this (phased development) is the requirement. Why do you want to take more than what you require?”

He emphasises that the group has no intention to sell its land “for a song”. “I’m looking at the interests of our shareholders so they can benefit 10, 20 years from now.”

SD Guthrie’s three major shareholders — Permodalan Nasional Bhd (42.36%), the Employees Provident Fund (14.83%) and Kumpulan Wang Persaraan or Retirement Fund (Inc) (7.5%) — collectively hold over 60% of the company.

He compares the current approach with the land disposals undertaken by SD Guthrie’s predecessors (Guthrie and Golden Hope) for the development of Kuala Lumpur International Airport (KLIA), Putrajaya and Cyberjaya, which did not yield comparable long-term returns as they made one-off gains when the parcels were sold.

“Oil palm will remain the core of the business. But investors should see that we are monetising and creating value from our land bank,” he says. 

Save by subscribing to us for your print and/or digital copy.

P/S: The Edge is also available on Apple's App Store and Android's Google Play.