Kasikorn Securities stated that Thai Union Feedmill Public Company Limited, or TFM, continues to face pressure on two fronts. It expects normal profit in the third quarter of 2026 to come in at 128 million baht, down 46% year on year and 8% quarter on quarter, due to higher fishmeal prices compared with the record-high gross margin base in the third quarter of 2025. The research team expects sales of 1.6 billion baht, down 5% year on year but up 10% quarter on quarter. The shrimp feed business, which accounts for 60 to 65% of sales, remains weak amid intensifying competition and growing use of substitute protein sources such as soybean meal and poultry meal. Meanwhile, gross margin is expected to fall 580 basis points year on year and 170 basis points quarter on quarter to 16.0%, below the 2026 target range of 17 to 19%, because fishmeal prices rose 59% year on year and 10% quarter on quarter to 62.9 baht per kilogram. Management said the 2026 sales and gross margin targets may be revised down further, and expects an expected credit loss provision of 10 million baht. On recommendations, the research team maintained its hold rating and its mid-2027 target price of 6.80 baht, with an assumed dividend payout ratio of 55% during 2026 to 2028, representing a dividend yield of 5.6%, which should help limit the stock's downside.
Thai Union Feedmill PCLShrimp feed business, 60-65% of sales, stays weak amid intensifying competition and substitution by soybean/poultry meal.
