FR CGS-CIMB (YU) : Charoen Pokphand Indonesia
Regulatory risk persists amid relief rally
CPIN IJ / CPIN.JK | REDUCE - Maintained | Rp3,800.00 tp:Rp3,400.00
Mkt.Cap:US$4,462.00m | Avg.Daily Vol:US$1.59m | Free Float:44.50%
Food & Beverages
Author(s):Patricia GABRIELA +62 (21) 3006 1734,
Prior to the long holiday, CPIN’s share price fell by c.5%, in part due to the first-ever price cap, issued by Ministry of Trade, applicable during the fasting month.
However, broiler prices were well above the cap, without punitive actions observed, which might have boosted CPIN’s share price post the holiday break.
That aside, broiler prices historically declined by 10-11% mom post the Lebaran festive season, usually dragging share prices down too.
The regulatory risk overhang persists, in our view, despite the seemingly cheerful ending to the festive month, particularly as we enter an election year.
The sector has de-rated from mean P/E of 26x to 18x since regulatory risks intensified in Jan 17. We maintain our DCF-based TP of Rp3,400 (WACC 11%).
Komentar
Posting Komentar