Agriculture
August 29, 2014
MHP posted 38% increase in EBITDA for 2Q14 to USD 166mn thanks to lower poultry production cost and 64% YoY increase in gain from revaluation of biological assets. The top and bottom lines were expectedly lower (by 7% and 14% YoY, respectively) in light of devaluation of domestic currency. The group managed to improve its leverage ratio to 2.45x vs. covenant of 3.0x while political risk exacerbated recently, especially in Crimea. We stick to our target price of USD 15.65 per share implying an upside potential of 30%.
