CLSA has upgraded CP Foods Public Company Limited (SET: CPF) to “Outperform” from “Hold” and raised its target price to Bt27.00 from Bt19.00, citing signs that the company is emerging from a cyclical trough as pork prices improve in Thailand and China.
The brokerage said CPF’s recovery cycle is now underway, supported by better livestock margins, resilient earnings from Vietnam and manageable feed costs. CLSA expects the earnings recovery to accelerate into 2027, while improving visibility and margin outlook could support a valuation re-rating.
According to CLSA, Thai and China swine margins are set to improve as hog prices firm and the market gradually shifts from oversupply toward normalization. Recent price data in July and August 2026 showed meat margins in Thailand improving to around Bt46-47 per kilogram, compared with below Bt40 per kilogram during the second quarter of 2026.
The recovery is also broadening across CPF’s key markets. In Thailand, rebounding swine and chicken prices, together with manageable feed costs, should drive margin expansion. In Vietnam, CPF’s core profit contribution remains resilient, with swine prices holding near VND59,000 per kilogram against costs of VND50,000-52,000 per kilogram. Meanwhile, China is recovering from a cyclical trough, with further improvement in pork prices expected to help reduce losses.
CLSA revised its 2026-2028 core profit forecasts by -9.0%, -0.1% and +0.2%, respectively, mainly to reflect weaker first-half 2026 operations. However, the brokerage expects pork price recovery to provide high operating leverage to CPF’s profitability, forecasting core profit growth of 20% in the third quarter of 2026 and EPS growth of 15% in 2027.
CLSA noted that CPF’s risk-reward profile remains attractive, supported by improving pork prices and margins. The brokerage said the outlook signals the start of an upward cycle, prompting its target price increase to Bt27.00 and upgrade to “Outperform.”
