XA Update Report | PT Indofood CBP Sukses Makmur Tbk. (ICBP) – Top-Line Stays Resilient, but Forex Storm Clouds the Bottom-Line

 

 

By Steven Willie

04-August-2026

 

 

ICBP delivered broad-based volume growth in 1H26, with revenue rising +11% YoY to IDR 41.9 tn, in line with our estimates at a 53% run-rate of our FY26F forecast. 2Q26 revenue grew +16% YoY (-7% QoQ), led by nutrition & special foods, dairy, and a resilient overseas franchise. Bottom-line, however, missed the mark: 1H26 net profit fell – 33% YoY to IDR 3.7 tn on a ballooning IDR 2.9 tn net forex loss tied to ICBP’s USD-denominated debt. Excluding this, core profit rose a modest +1% YoY to IDR 5.4 tn. With IDR weakness, and elevated input costs persisting into 2H26F, we trim our FY26F net profit forecast to IDR 8.4 tn (-9% YoY) while maintaining our TP at IDR 6,850/share.

 

 

🔹1H26 & 2Q26 Financial Performance

 

•Top-line stays resilient, broad volume growth carries the day. ICBP booked a solid 1H26 revenue of IDR 41.9 tn, up +11% YoY, in line with our estimates at a 53% run-rate of our FY26F forecast. 2Q26 revenue alone grew +16% YoY (-7% QoQ), underpinned by broad-based volume growth across all business segments.

 

 

• Dairy and nutrition emerge as the new growth engines worth monitoring. Nutrition & special foods (+31% YoY/-1% QoQ) and dairy (+27% YoY/-5% QoQ) led 2Q26 segmental growth, followed by noodles at +15% YoY (-7% QoQ). Snack foods grew +11% YoY (-2% QoQ), food seasonings rose +9% YoY (-20% QoQ), while beverages remained the relative laggard, up a modest +3% YoY (+6% QoQ).

 

 

• Overseas sales extends its lead. Overseas sales grew +22% YoY in 1H26, lifting its contribution to 32% of total sales (vs. 29% in 1H25), while domestic sales grew a steadier +7%. The overseas push accelerated further in 2Q26, up +31% YoY (+15% QoQ), with Asia & Africa (+30% YoY/+19% QoQ) and Other Nations (+35% YoY/-9% QoQ) both firing. We attribute this to ICBP’s extensive overseas distribution network, solid regional demand, and the ramp-up of new production capacity that came onstream last year.

 

 

• Forex losses drive the profit miss. 1H26 GPM eased to 34.3% (vs. 34.9% in 1H25) and OPM to 21.9% (vs. 22.5% in 1H25), reflecting continued input cost pressure. The bigger blow came below the operating line: NPM collapsed to 8.8% (vs. 14.7% in 1H25), pulling net profit down -33% YoY to IDR 3.7 tn (40%/45% run-rate of our old/new FY26F estimates). This was primarily driven by a net forex loss on financing activities of IDR 2.9 tn (vs. IDR 227 mn in 1H25), as IDR depreciation weighed on ICBP’s debt book, 98% of which is foreign-currency-denominated (mainly USD bonds). Stripping out this item, core profit was roughly flat, up +1% YoY to IDR 5.4 tn.

 

 

 

🔹Costly Ingredients, Same Recipe. Trimming Our FY26F Bottom-Line

 

• A weaker Rupiah remains the biggest swing factor. IDR depreciation hits ICBP on two fronts — inflating USD-denominated input costs and generating forex losses on its foreign-currency debt. The Rupiah has depreciated -8% YoY, trading around IDR 17,900-18,000/USD; any further weakness would amplify the forex loss going forward.

 

 

• CPO prices, a key input cost, stay elevated with little sign of relief. Global CPO is trading at MYR ~4,600/ton (+16% YTD/+11% YoY). Domestic CPO prices, though less correlated to global benchmarks, have also risen +3% YoY to IDR 14,615/kg in 1H26 per INDF’s CPO ASP. We expect prices to stabilize above the MYR 4,400-4,500/ton range through year-end.

 

 

• We trim our FY26F net profit forecast to IDR 8.4 tn, implying a -9% YoY decline and NPM of 11% (vs. 12% in FY25), reflecting these persistent currency and commodity headwinds.

 

 

🔹HOLD Recommendation with Target Price at IDR 6,850/Share

 

 

• We maintain our HOLD rating on ICBP with an unchanged target price of IDR 6,850/share. Our FY26F outlook remains broadly intact, with key overhangs, IDR weakness and elevated input costs, still in play. However, we continue to see ICBP’s core business as resilient, with volume growth solid across all segments; dairy segments is also worth monitoring as the company’s next growth engine alongside noodles. That said, amid ongoing macro and global uncertainty affecting currency, freight, and commodity prices, near-term margin recovery is unlikely. We will continue to monitor these key risks going forward.

 

 

•Risks: (1) Weaker-than-expected consumer purchasing power; (2) higher-than-anticipated input costs; (3) intensifying competition from substitute and competing brands; (4) IDR depreciation.

 

 

 

Download full report HERE.

 

 

 

 

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