Analisa Saham MAIN | 7 Agustus 2018

FR CGS-CIMB (YU) : Malindo Feedmill
Riding the poultry upcycle
MAIN IJ / MAIN.JK | ADD - Upgrade | Rp1,020.00 tp:Rp2,100.00▲
Mkt.Cap:US$157.50m | Avg.Daily Vol:US$0.52m | Free Float:42.70%
Food & Beverages
Author(s):Patricia GABRIELA +62 (21) 3006 1734,

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■   In the last two decades, Indonesia’s poultry cycle has witnessed about five boom years followed by two years of bust. We seem to be in the third year of an upcycle.
■   In the last upcycle, the big 3’s earnings posted 17% CAGR in 2009-12. After two bust years, earnings have since rebounded, except for 2017 which was hit by one-offs.
■   The smallest of the big 3, MAIN, suffered more during poultry cycle downturns, but its share price outperformed its peers during the last upcycle year by more than twofold.
■   With earnings picking up pace over the last three quarters, MAIN’s share price has started to catch up, though it has still underperformed its peers in this upcycle.
■   We upgrade from Hold to Add with a higher TP of Rp2,100, based on 15x FY19F P/E.