According to Deputy Minister in the Prime Minister’s Department Razali Ibrahim, Felda Global Ventures Holdings Berhad's (FGV) management cannot be blamed for the drop in their stock prices.

This is in response to the many voices, including that of Petaling Jaya Utara MP Tony Pua ( right ), who are of the opinion that the Felda management is at fault.

Instead, he said fingers should be pointed at the drop in global palm oil prices, which a majority of FGV’s business is based upon.

“Seventy-five percent of the business (FGV) is based on palm oil commodity. When the price drops, it will affect the price of FGV (stocks),” Razali said at a press conference today.

It was previously reported by Bloomberg that the FGV stocks - which debuted in 2012 at RM5.39 - has dropped by almost half and is currently at RM2.20.

Razali added that the FGV stocks cannot be compared with other plantation stocks because they generate income through various measures.

“You cannot compare Felda FGV with Sime Darby (Plantations) or IOI (Plantation) because they are much more diversified. They have properties and many other avenues which contribute (to the company).”

Razali also said that the stock price determination depends on three factors which are management, commodity prices and world stock prices.

He said that the current FGV stock price is dependent on the world stock price.

“This is what has happened to the FGV stock today, which to me is quite alarming and sad.”

'Don't sell your stocks'

Meanwhile, he also urged current FGV stock holders to keep their shares instead of selling them off as they might increase in the future.

“I hope all the stockholders do not sell their stocks, so that the losses are not materialised yet.

The Muar MP added that Felda is currently in the process of replanting palm oil trees to replace the current trees which are old.

“Felda is in the process of replanting the palm oil crops. They will be ready to be harvested by the end of 2016 to 2018.

“We will be ahead of plantation companies when these crops mature and are ready to be harvested,” Razali said.

FGV has come under fire since it announced its public listing on June 28,2012.

On Oct 28, Pua had warned that FGV may go the way of ailing Proton or Malaysia Airlines if the government did not intervene to turn the company around.

FGV’s share price closed at RM3.47 when Pua issued the warning.

The company’s Initial Public Offering (IPO) was plagued by controversy due to political pressure from the opposition opposed to its listing.

Felda had been a largely successful scheme which brought together villagers for oil palm cultivation and uplifted the community.