CIMB AALI - Mayora Indah Result note - Beat expectations by a wide margin

(MYOR IJ / MYOR.JK, OUTPERFORM - Upgraded, Rp2,950 - Tgt. Rp3,950, Consumer)

We upgrade Mayora to Outperform from Underperform with a higher target price of Rp3,950 (from Rp3,600), still DCF-based. Mayora's 3Q09 results were significantly ahead of consensus and our forecasts from higher-than-expected sales and margins. Consequently, 9M09 core profit, which grew 92.6% yoy, forms 97% of our FY09 forecast and 110% of consensus. Our target price upgrade comes on the back of our earnings upgrade of 1-18%, powered by the better-than-expected 3Q09 results. While our previous concern over its margin sensitivity to rising commodity costs (sugar specifically) remains, this has been mitigated by our stronger currency view. Share-price catalysts remain better-than-expected earnings growth, in our view.