16. TAN SRI LEE OI HIAN & DATUK LEE HAU HIAN Flagship: Batu Kawan Bhd, Kuala Lumpur Kepong Bhd (KLK) Net worth: RM3.62bil

BROTHERS Oi Hian and Hau Hian saw their wealth shrink last year due to volatile crude palm oil (CPO) prices.

From the 15th spot in 2017, their wealth dipped by nearly 15% to RM3.62bil from RM4.25bil a year earlier.

Much has to do with the oversupply situation of CPO in the market place and the sluggish export demand. The European Union ban on palm oil products does not bode well for the industry.

But experts are predicting CPO prices will stabilise this year. The forecast of CPO for 2019 is at RM2,280 per tonne and RM2,350 for 2020.

All this had put a strain on their earnings last year.

But KLK is one of the largest plantation companies in the country.

The Lee brothers are more known for their interest in KLK than the parent company Batu Kawan. They are the sons of the late founder Tan Sri Lee Loy Seng.

It was in 1992 that Batu Kawan sold all its plantation assets to KLK in exchange for shares.

They control 50.3% of Batu Kawan, which, in turn, owns 46.6% of KLK.

Oi Hian, 67, is the non-executive chairman of Batu Kawan and chief executive officer of KLK. The 65-year-old Hau Hian is Batu Kawan’s managing director and non-executive director of KLK.

Often Batu Kawan is seen as a cheap proxy to KLK. Its stake in KLK is worth more than double its own market capitalisation of RM7.4bil. Based on Friday’s closing KLK market capitalisation was at RM25.9bil.

KLK has also diversified into a resourcebased manufacturer of oleo-chemical, derivatives and specialty chemicals. It has also vertically integrated its upstream and downstream businesses. It is also into property development by capitalising on its strategic land banks.

For full financial year 2018, KLK reported a 25.1% drop in net profit to RM753.3mil from RM1.01bil in FY17, while revenue fell 12.4% to RM18.4bil from RM21bil.