Maybank cut its target price (TP) to ฿21.30 (US$0.66), based on 9x FY26E P/E (Financial Year Price-to-Earnings), representing a one standard deviation discount to its five-year average. Despite revising up FY25–27 estimate core earnings per share (EPS) forecasts by 4–17% on stronger-than-expected second-quarter results, the bank warned that CPF's profitability will likely decline in the second half of 2025.

 

Thai swine prices dropped below ฿70 (US$2.17) per kilogramme in August, down from  ฿87 (US$2.69)/kg in 2Q25 and  ฿72 (US$2.23)/kg in August 2024 — marking the first year-on-year decline this year. Maybank attributed the weakness to muted demand during the monsoon season and lower slaughtering capacity caused by a labour shortage stemming from the Thai-Cambodian dispute, which created an oversupply of live swine.

 

Although large producers have agreed to suspend pig-breeding expansion for the next two years, analysts believe swine prices in Thailand likely peaked in 2Q25. In Vietnam, prices have also weakened, falling to ₫55,000– ₫60,000/kg (US$2.09 – US$2.28) in August from ₫68,000 (US$2.58)/kg in 2Q25, pressured by the spread of African Swine Fever (ASF), which has forced farmers to cut herd sizes.

 

"We expect it will take over six months for Vietnamese swine prices to recover," Maybank noted, adding that CPF's 2H25 earnings could fall as much as 45% HoH.

 

CPF's feed costs are expected to decline in the second half of 2025, helped by ample global soybean supply and Thailand's upcoming corn harvest. However, Maybank warned that feed prices could rebound in FY26 on the back of El Niño-related supply risks, compressing gross profit margins (GPM).

 

The bank projects CPF's GPM to fall to 14.6% in FY26E, compared to 17.2% in FY25E, driving a forecast 32% YoY decline in core EPS in FY26.

 

On a positive note, CPF could gain some cost relief from lower tariffs on US corn and soybean meal imports. Maybank estimates this could reduce feed costs by ฿2 (US$0.062)/kg and cut soybean meal costs by around 2%, providing meaningful upside to earnings.

 

"Every 0.5% change in GPM provides around 7% upside to our FY26 EPS forecast," the analysts said.

 

Given the softer swine outlook, Maybank expressed preference for GFPT Public Company Limited, which benefits from strong demand for broilers in the export market. GFPT currently trades at ฿10.1(US$0.31), with a target price of ฿12.0 (US$0.37).