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CPIN

Contact our analyst Eka
BUY, 30% upside
25th Aug 2021 
​Price Rp 6,600

Target price Rp 8,580
Maintaining Double-digit Sales Growth
  • ​CPIN double-digit sales growth continued in the 2Q2021. CPIN recorded sales in 2Q2021 of IDR 13.06 trillion +34% YoY and 5.3% QoQ.
  • Broilers recorded higher growth of 56.3% YoY or 11.2% QoQ to IDR 6.77 trillion and still contributed the most at 51.8% of total sales, followed by DOC +47% YoY to IDR 623 billion, and processed chicken +27% YoY to IDR 1.83 trillion.
  • Feed also recorded positive sales  of IDR 3.47 trillion, growth of +8.5% YoY.
  • For 1H2021, CPIN recorded sales of IDR 25.47 trillion or 28.8% YoY growth. Broiler and DOC sales were IDR 12.8 trillion and IDR 1.27  trillion which is growth of 55% and 31.2% YoY respectively.
  • Selling prices have started to recover from early 2021 with stronger sales of broiler and DOC inline with higher demand.  We expect CPIN will maintain double-digit growth in 2021. We  are targeting 15.5% YoY growth in 2021F to IDR 49.1 trillion. 

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And  Improved Margins
  • With double-digit sales growth, CPIN net profit also increased sharply by +87% YoY to IDR 1.37 trillion in 2Q2021, but profit was lower -5.3% compared to 1Q2021. There was a higher NPM 10.5% from 7.6% last year.
  • For 1H2021, CPIN recorded net profit of IDR 2.83 trillion which is double-digit growth of +73% YoY and the net profit margin increased to 11.1% from 8.3%.
  • Cost of sales also increased +27.3% YoY to IDR 10.39 trillion in 2Q2021. Gross profit increased +68% YoY to IDR 2.67 trillion with an improvement in the gross profit margin to 20.5 % from 16.3%.
  • Operating profit grew +85% YoY to IDR 1.84 trillion in line with a higher operating profit margin, of 14% from 10%.
  • The positive sentiment from government supply adjustments has significantly improved prices since early 2021 and resulted in better margins in 2Q2021 and 1H2021.
  • As CPIN performance continues to improve, we revise our forecast for 2021F. We expect CPIN’s profit will reach IDR 4.77 trillion with 24% growth.

Valuation: TP 8,580, 30% upside
  • We are targeting CPIN to trade at a 27x 2022F PE within a year. Target Price is IDR  8,580 which represents 30% upside. We maintain our recommendation to buy.
Read the full report
Previously
​CPIN Jun2021
​CPIN Jan2021
PT. Binaartha Sekuritas

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