Excerpts from DBS Vickers' report
Recent spike in day-old-chick (DOC) prices, currently hover above Rp6,000/chick – significantly higher than Japfa’s 3Q15 DOC ASP of Rp4,400/chick, prompted the Indonesia government to consider price ceiling.
We do not expect the proposed price ceiling to impact Japfa’s profitability, as our FY15F/FY16F ASP assumptions of Rp4,085/Rp4,207 remain well below current elevated prices.
BUY rating reiterated on 88% upside to S$0.90 TP.
Full report here.