PWF Corp: Target Price Elevated to RM1.22

PWF Corp Bhd, a leading Malaysian poultry firm, has received a target price of RM1.22, reflecting a 38.6% premium over its recent closing price of 88 sen. This valuation, based on a P/E multiple of 8.0 times the projected FY2025 core EPS of 15.2 sen, aligns with industry peers’ valuations.

Apex Securities Bhd highlights PWF’s advantage as a fully integrated poultry company with in-house feed production, benefiting from lower feed costs and higher chicken prices. The company’s robust earnings growth outlook is supported by decreasing feed costs due to lower soybean and corn prices, as well as a favorable forex environment from a stronger ringgit.

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PWF Corp

The recent removal of chicken price controls and subsidies by the Malaysian government further benefits PWF by allowing more flexible pricing and capturing higher chicken prices, which have risen from RM5.90/kg in late 2023 to RM7.00/kg in mid-2024.

PWF’s significant feed mill operations and integrated business model enhance its market position. The company is expected to offer attractive dividend yields of 5.1% in FY2024 and 5.7% in FY2025, driven by improved earnings and subsidies.

PWF’s stock rose by 1.7% to 89.5 sen, with a market valuation of RM285 million.

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