March 25, 2008

Strong 2008 results expected for CPF on strong domestic consumption
 

Domestic consumption will mean strong results are expected for Thailand's Charoen Pokphand Foods' (CPF) despite prices for major product prices, especially for pork, hitting high levels in Jan-Feb this year, according to stock analysts.

Pork price had risen 76 percent on-year  to Bt58/kg in February 2008. And it should remain firm for the rest of the year due to supply shortage. However, raw material prices (corn, soybean, and fishmeal) also remain high.

A strong recovery in domestic consumption and prospects for overseas businesses meant the company should perform favourably in 2008.

Sales contribution should reach 17 percent of CPF's group sales in FY08F, analysts said.

Given the continued recovery of local meat prices and potentially higher dividend yield this year, analysts are optimistic of a turnaround for CPF in the first quarter of 2008.