Charoen Pokphand Foods

Charoen Pokphand Foods Plc (CPF)  

With the acquisition of CPP, CPF will enjoy considerable growth potential in China and Vietnam given the large populations, higher per capita consumption and the proposal to improve food safety standards. We project EPS accretion from year one despite a 10% dilution. Consolidating CPP into CPF lifts our FY12-14 EPS forecasts despite a 10% higher share base. Accordingly, our SOP-based target price increases from THB43 to THB48. We maintain our Outperform call.