- Thai Beverage (SGX:Y92)'s results were within expectations. 1H24 revenue and PATMI were at 50%/53% of our FY24e forecasts. Margins are ahead of expectations, but associate profit fell 83% y-o-y on weaker property sales and higher taxes.
- - Read this at SGinvestors.io -
The Positive
Beer volume recovery.
- There was a significant turnaround in beer volumes. After 4 quarters of decline, beer volumes rebounded on market share gains, warmer weather, more marketing events, a higher number of tourists, and overall improvement in macro conditions.
The Negative
Associate earnings collapse.
- - Read this at SGinvestors.io -
Outlook
- We believe beer volumes are on a recovery path in Thailand and Vietnam. Economy beer is the fastest growing segment, ahead of the premium segment. The new beer entrant has yet to make a dent in Thailand, with a market share of less than 2%. Lower malt and packaging costs will support beer margins in the coming quarters.
- Spirits consumption is mature. We believe any significant growth in Thailand will depend on government support measures for consumption.
Maintain BUY with lower target Price of S$0.63 (previously S$0.67)
- Read more at SGinvestors.io.
