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Don't chicken out of Japfa over broiler price declines, says Maybank

Michelle Zhu
Michelle Zhu4/2/2019 12:37 PM GMT+08  • 2 min read
Don't chicken out of Japfa over broiler price declines, says Maybank
SINGAPORE (April 2): Maybank Kim Eng is maintaining “buy” on Japfa with an unchanged price target of $1.05 despite recent declines in Indonesian poultry stocks, due to market fears of oversupply after broiler prices declined further in March.
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SINGAPORE (April 2): Maybank Kim Eng is maintaining “buy” on Japfa with an unchanged price target of $1.05 despite recent declines in Indonesian poultry stocks, due to market fears of oversupply after broiler prices declined further in March.

In a Tuesday report, analyst Neel Sinha says these concerns are likely overblown, as he concurs with Japfa’s management theories that the broiler price correction has more to do with seasonal weak demand rather than oversupply.

“Prices have corrected every year by 7-30% in a seasonal demand slump sometime late in 1Q/early 2Q (between CNY and Lebaran) followed by a recovery ranging from 26-44% up to Lebaran,” explains Sinha.

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