Jovin Anwar

Charoen Pokphand Indonesia (CPIN IJ) - Valuation Stretched At +2SD To Its Historical Mean PE; Downgrade To SELL

CPIN has given investors a 117.5% share price appreciation since 2018 until now,
and is trading at 31.5x 2019F PE, more than +2SD to its historical mean PE. Feed
ASP increase is likely to be marginal in 2019. Current valuation is pricing in
significantly higher-than-historical volume growth. We expect EPS to fall 2.6% yoy in
2019 due to higher raw material prices. Downgrade to SELL with target price at
Charoen Pokphand Indonesia Tbk

P.T. Charoen Pokphand Indonesia is a poultry feed, day old chicks and processed chickens production group based in Indonesia. Co. is focused on agro-business activities that encompass the entire spectrum of the poultry business, from the production of feed products, breeding of poultry stock and production of processed poultry products. Co. maintains a network of production facilities in Balaraja (West Java), Semarang (Central Java), Sepanjang and Krian (East Java), Bandar Lampung (Lampung), Medan (North Sumatra) and Makassar (South Sulawesi). Co. is also engaged in the production and supply of poultry breeding stock for layer and boiler chicken in Indonesia.


Jovin Anwar

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