* Main defence on Jan. 12, further detail on Jan. 14
* Focus on value as white knight hopes fade
* To upgrade 2009 forecasts, give 2010 outlook
LONDON, Jan 8 - British bid target Cadbury (CBRY.L) will paint an upbeat picture for 2010 and upgrade 2009 forecasts next week in a final attempt to fight off a hostile bid from Kraft Foods (KFT.N), analysts said on Friday.
But a small rise in Kraft's hostile 10.5 billion pound ($16.8 billion) bid will be enough to win over Cadbury shareholders, most analysts and investors believe, even if good Christmas trading and cost cutting allow the confectioner to beat its guidance for underlying 2009 sales growth and margin.
The key will be what Cadbury can say to boost the long-term strategic value of the business and how much more Kraft will be willing to pay, an industry analyst said.
Cadbury is likely to upgrade previous forecasts for a 2009 operating margin of 13.3 percent and underlying sales growth of around 5 percent, analysts said, adding they will be scanning what it says about sales, margins and input costs for 2010.
The company is due to give the bulk of its final argument for staying independent on Jan. 12, the 39th day of Britain's 60-day takeover process but the Takeover Panel has allowed Cadbury to provide extra detail shortly after the London market closes on Jan. 14, given the proximity of its Dec. 31 financial year end.
Termed Cadbury's second response document after its first defence statement in mid-December, Cadbury is expected to focus on its position after Christmas trading and Kraft's bid.
Kraft's cash and shares bid, launched in September, has gained in value over the past few days as the U.S. food company's stock has risen and the dollar strengthened to make the offer worth 768 pence against a Cadbury share price down 0.1 percent at 776 pence by 1320 GMT.
Many analysts and investors say Kraft will have to raise the bid to at least 800 pence to succeed. It has until Jan. 19 to change its bid while Cadbury shareholders have until Feb. 2 to accept.
The focus will be on the value of Cadbury rather than looking for any white knight bidders, said another analyst.
Earlier this week, Swiss food group Nestle (NESN.VX) ruled itself out from a Cadbury auction while hopes have faded for counterbids from Hershey (HSY.N) and Italy's Ferrero, who have both expressed interest.
Ferrero's interest in Cadbury has cooled, sources familiar with the situation said on Thursday, while analysts say it will be difficult for Hershey to mount a bid without the potential financial backing of Nestle. [ID:nN07213840]
Kraft chief executive Irene Rosenfeld has stuck to her guns, refusing to increase the overall price of the Cadbury bid since it emerged in early September, while Cadbury chairman Roger Carr has been equally firm in rejecting the bid, terming it derisory.
Rosenfeld's predicament was highlighted this week when Kraft's biggest shareholder, Warren Buffett, told her not to overpay with a large issue of new Kraft shares. [ID:nLDE6040C0].
Cadbury has already forecast 2009 sales rising 11 percent to 6 billion pounds, underlying operating profit up 24 percent to 794 million, and EBITDA 21 percent ahead to 1.004 billion.
It has also forecast underlying 2009 sales growth in the middle of its 4-6 percent target range and an operating margin of 13.3 percent from 2008's 11.9 percent. Analysts say these figures could be upgraded to as much as 5.3 percent and 13.6 percent.
Last month, Cadbury announced longer-term targets to look for annual sales growth of 5-7 percent from 2010, operating margins to rise to 16-18 percent by 2013 and double-digit dividend growth for 2010 and beyond.
(Reporting by David Jones; Editing by Dan Lalor) ($1 = 0.6269 pound)