Indofood Agri

Indofood Agri: CIMB maintains O/p with $1.51 TP. House like Indofood Agri’s purchase of sugar assets in Brazil as the growth potential is compelling and the acquisition price is fair. The group expects its Brazil mill to raise its sugar production from 2.1m tons in FY13 to 3.8m tons in FY15. House also view the implied EV/tonne for the sugar mill capacity as fair, being within recent market transactions. Overall, maintain Outperform call and target price of $1.51, which is based on a 10% discount to its SOP value. Key re-rating catalysts are this acquisition and better CPO prices.