LEONG Hup International Bhd stock price slid 12.6% to 62.5 sen with close to 25 million shares exchanging hands at 12.30pm, after posting a lower fourth-quarter net profit of RM81.6 million.

The integrated poultry and egg producer hit an intraday low of 61.5 sen. Earlier this week, on Feb 26, the counter hit 72.5 sen, a 52-week high.

In an exchange filing yesterday, Leong Hup said its revenue for the fourth quarter ended Dec 31, 2023 (4Q23) was up by 3.9% to RM2.4 billion mainly due to average selling price and sales volume of broiler chickens and higher sales volume of day-old-chicks (DOC) in Indonesia and higher sales volume of dressed chickens in the Philippines.

For the year ended Dec 31, 2023 (FY23), it posted a net profit of RM301.7 million, up 38% from the year before, on RM9.5 billion in turnover which was 5.5% higher than FY22.

It said the strong regional economies provide a good backdrop for higher consumption of its products as the group continues to grow.

"The easing of feed input costs, particularly corn and soybean meal, provides relief to the industry but the strong US dollar mitigates savings pass through to customers. Barring unforeseen circumstances, the group expects to achieve a satisfactory performance for financial year 2024," said Leong Hup.

In a report released today, Hong Leong Investment Bank Bhd Bhd (HLIB Research) has maintained a 'Hold' call for Leong Hup's counter, with an unchanged 52-week target price (TP) of 74 sen based on 12.5 times FY24 core earnings per share (EPS) of six sen.

"While easing of feed input costs (particularly, corn and soybean meal) is positive for poultry players (including Leong Hup), this is insufficient to mitigate the strong US dollar and weak poultry prices in major operating countries," said HLIB Research.