* EBIT margin target 15.0 percent vs avg expectation 15.4
* Had met previous target of 13.5 percent
* Keeps organic growth target of 5-7 percent over cycle
* Shares fall 4.9 percent
(Adds details, share price)
By Teis Jensen
AARHUS, Denmark, Oct 8 (Reuters) - Danish food ingredients and enzymes maker Danisco raised its operating profit margin target by less than expected and said it would take some years to reach the goal, denting its shares on Friday.
The new long-term EBIT margin target of 15 percent was defended as realistic and achievable by Danisco Chief Executive Tom Knutzen, who said progress towards the target will depend on external factors like commodity prices and the broad economy.
The new target missed an average expectation of 15.4 percent in a Reuters survey of five analysts earlier this week which had ranged from 15 percent to 16.5 percent with the median at 15 percent.
"It was lower than I had thought," ABG Sundal Collier analyst Frans Hojer said. "I had expected a target of 16-17 percent, but since this is a minimum goal, there is probably room to reach up to 16 percent."
Jyske Bank analyst Jens Thomsen said the new target was in line with his expectations and with the Reuters survey.
"The target is no hindrance to striving for more," he said.
Shares in Danisco sank 4.85 percent to 470.80 crowns by 1047 GMT, underperforming a 0.3 percent fall in the Copenhagen bourse's bluechip index.
Danisco, whose products are used in consumer goods from foods and beverages to biofuels and detergents, reiterated its target for organic growth of 5 to 7 percent over the business cycle -- largely as expected by analysts.
Danisco had signaled a new, higher target for its earnings before interest and tax (EBIT) margin last month when posting a 12-month average margin of 13.7 percent, compared with its 13.5 percent target.
"We are confident that we can achieve these new financial ambitions," CEO Knutzen said on Friday. He did not give an exact timeframe for achieving the targets but told reporters that reaching them would take a "handful" of years.
Knutzen refrained from calling the EBIT margin target conservative but said: "This is not an American 'stretched target. This is something that is possible."
"This is also the picture we want to give of Danisco -- that we can live up to what we say," he told reporters.
External factors such as fluctuations in exchange rates, costs for commodities and energy, combined with developments in the global economy, may accelerate or decelerate progression towards the goal, he said in the statement.
DIVISIONAL MARGIN TARGETS
Danisco is a major player in the $24 billion food ingredients market, competing against the likes of Cargill, Ireland's Kerry Group, J.M. Huber Corp, Cognis and Denmark's Chr. Hansen. In the near duopoly of industrial enzymes, Danisco's main competitor is Danish peer Novozymes.
The company, which makes products used to extend meat shelf life, remove fuzz from fabrics and improve the smell of pet foods, also set separate EBIT margin targets for its divisions. These include above 14 percent for Enablers, above 18 percent for Cultures, above 10 percent for Sweeteners and above 17 percent for enzymes unit Genencor .
Several drivers should boost financial performance over coming years, including increased research and development investment to strengthen its product offering, Danisco said.
Volume growth and capacity expansion within its existing industrial set-up should further enhance cost competitiveness and returns.
"And more efficient internal processes within the entire organisation will lower our relative cost level," Danisco said.
Danisco also reiterated its long-term target for gearing equal to 1.5 to 2.5 times earnings before interest, tax, depreciation and amortisation (EBITDA). The company bumped up its long-term target for return on net operating assets (RONOA) to above 20 percent from a previous goal of above 18 percent.
(Reporting Teis Jensen, writing by John Acher; Editing by Dan Lalor and Hans Peters)