DAVY VIEW

Despite being DSM’s largest business, the structural growth attributes and durability of the animal nutrition (AN) model are arguably underappreciated. DSM has married a unique AN strategy with first-class operational execution on an international scale. If the historic narrative for AN was about feed efficiency and conversion rates, the future will be about sustainability, animal welfare and smart additives. The use of feed ingredients to address environmental and nutritional factors heralds the next chapter for the industry – ‘feed becomes food’ is emerging as the Zeitgeist. With sustainability in its DNA, brand strength and a unique supply chain position, we believe DSM has assumed an industry leadership position. We have strong conviction on model relevancy and believe the continued development of the AN platform represents a structural growth opportunity. We upgrade our rating to ‘Outperform’ from ‘Neutral’.