Poultry (Overweight/Maintain) - DOC Leads Rebound as MBG Resumes

DOC recovered to IDR5,286/chick in July 2026 (+51.5% MoM, -0.1% YoY), its strongest monthly gain since May 2025. Broiler rose to IDR18,661/kg (+11.4% MoM, +2.5% YoY), still below the IDR19,500/kg floor set under the national poultry price stabilization program signed on June 29, while corn was little changed at IDR6,490/kg (+0.1% MoM, +31.9% YoY). We attribute the DOC recovery to the broiler rebound, which reflects the joint commitment among poultry companies, associations, Dirjen PKH, and POLRI, alongside the MBG resumption.

In 7M26, DOC averaged IDR5,809/chick (+18.1% YoY) and broiler IDR20,124/kg (+12.8% YoY), both above their FY25 averages, while corn averaged IDR6,588/kg (+38.8% YoY, 27.7% above FY25). Firm output prices point to resilient poultry demand, supported by MBG spending of IDR101.1tr in 1H26 against IDR5tr a year earlier. JPFA tracked the JCI, up 10.5% MoM in July, while CPIN underperformed by 13.7%. Both saw net foreign outflows in the month (IDR90bn JPFA, IDR51bn CPIN) but stay positive in 7M26, at IDR387bn and IDR257bn of net inflows. Local ownership rose 1ppt to 19.5% at JPFA and 0.3ppt to 12.6% at CPIN as foreign IB trimmed, which we read as tactical.

We maintain Overweight on the sector, given the continued recovery in DOC and broiler prices as MBG resumes. In our coverage, CPIN is Trading Buy with TP IDR3,550 (15.3% upside, 4.7x FY26F EV/EBITDA) and JPFA Buy with TP IDR3,750 (69.7% upside, 4.1x). Downside risks: lower-than-expected DOC and broiler prices, higher input costs, and a smaller MBG impact.