Petra Foods

Petra Foods: OCBC upgrades to Hold with $3.88 TP. Note that since its sell call a month ago, Petra Foods’ share price has fallen by as much as 17.9% before recovering to close about 7% lower. Although the outlook is still challenging for Petra – the World Bank recently trimmed its forecast for Indonesia’s economic growth this year to 5.9% from 6.2% previously. House believe that the sell-offs are about done and Petra is fairly valued at this point. Ahead of its 2Q13 results release, and upgrade Petra to HOLD on valuation grounds, with an unchanged fair value estimate of $3.88. Investors should also expect a larger than expected loss from the divested cocoa ingredients segment in 2Q13.