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May 03, 2016 08:56:12
Indofood Sukses - Support from margin expansion

INDF's 1Q16 results were above estimates (29% FY16F) on better-than-expected margin. We subsequently raised our FY16-17F earnings estimates by 10-11% and upgraded our TP to IDR8,500 from IDR8,000. Our new TP implies 20% discount to our SOTP valuation, similar to previous TP, or 18x PER FY17F. Maintain BUY as we expect INDF to benefit from its exposure to the CBP business and El Nino’s positive impact on its agribusiness.

$INDF $ICBP $LSIP $SIMP
Bull
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