Broker Name: CGS International
Date of Report: March 20, 2026
Excerpt from CGS International report.
Report Summary
- Delfi Ltd is expected to generate strong cash flow in FY25 despite high cocoa prices, positioning the company well for market share gains and margin recovery as cocoa prices ease further.
- Gross profit margins are anticipated to improve from 2H26 as high-cost cocoa inventory rolls off, and Delfi’s focus remains on strengthening its own brands in core Southeast Asian markets, supported by increased marketing investment.
- FY25 revenue was stable at US\$500m, with Indonesia sales down but regional markets offsetting some decline; EBITDA improved in 4Q25 due to one-off gains and cost optimisation.
- The share price has rebounded, reflecting expectations of margin recovery, but further earnings growth is expected to accelerate in FY27 as operating expenses support longer-term growth strategies.
- The report reiterates a Hold rating with a target price of S\$0.91, noting upside risks from sustained cash flow and downside risks from forex volatility and potential economic downturns.
- ESG scores for Delfi are solid, with ongoing sustainability initiatives, but possible exposure to unresolved tax claims in Brazil remains a risk factor.
- Key financial metrics for FY25–FY28 show gradual growth in revenue, EBITDA, and net profit, with improving margins expected as external cost pressures subside.
Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website: https://www.cgs-cimb.com
