1Q09 net profit of Rmb 42.8m, down 70% yoy represented merely 5.3% and 5.4% of our and market FY09 forecast. Key discrepancies include (i) lower than expected HTMP, frozen pork and by-product sales, (ii) steeper than expected gross margin contraction (iii) higher than expected tax rate and (iv) higher operating expenses incurred for its pig farming project. Stripping out Rmb8.31m losses from its associate, profit from its core operation was Rmb 51m, still down by 64% yoy. This was disappointing as it reflects its lack of pricing power amidst stiffer competition. As hog prices continue to trend lower, we see continued earnings weakness. We have chopped our EPS estimates by 32.2-34.2% in FY09-11. Following the recent rally and the disappointing 1Q showing, we expect selling pressure on the stock. Downgrade from outperform to Underperform with a reduced target price of S$0.53 (S$0.85 prev.)