Thai Beverage

[winston]

not vested

Lagging, But Recovery Signs Are Brewing

Latest data from the UTCC showed a pick-up in consumer confidence levels to a five-year high.

We deem this a positive sign that alcohol consumption may be gradually recovering.

Meanwhile, THBEV has restructured its management positions to include designated roles to improve acquired businesses and gain synergies.

Upgrade to BUY with SOTP-based target price of S$0.84.

Source: UOBKH

https://research.uobkayhian.com/content ... b6b6ab8eae

[winston]

not vested

ThaiBev started at 'buy' by Exotix Capital ahead of expected earnings rally

By Stanislaus Jude Chan

SINGAPORE (Oct 26): Exotix Capital is initiating coverage on Thai Beverage with a “buy” recommendation and a target price of 90 cents.

“ThaiBev is on the verge of sustained earnings growth, powered by its foray into Vietnam and a turnaround in the Thai beer business,” says analyst Nirgunan Tiruchelvam in a report on Thursday.

After five quarters of sub-par growth due to the mourning period since the death of the king, the analyst expects vibrant growth in beer revenues in the next three years.

In addition, ThaiBev’s investment in a 54% stake in Sabeco could create synergies and drive earnings in Vietnam, he says.

“[ThaiBev’s] core spirits business is on a sound footing despite recent weakness,” Tiruchelvam says. “The spirits segment will be the mainstay of Thai Bev’s profits, at over 80% of bottom line in our forecast period.”

At the same time, Tiruchelvam notes that concerns over ThaiBev’s leverage are” misplaced”. According to the analyst, ThaiBev’s headline net gearing stands at 1.5 times, while its interest coverage ratio has dropped from 27 times in 3Q18 to just 5 times in 4Q18.

“However, ThaiBev can bolster its balance sheet by disposing of its associate stakes in Fraser and Neave (FNN) and Frasers Property (FPL), which are collectively worth US$1.6 billion,” Tiruchelvam says.

The way he sees it, there is a high probability of a restructuring of ThaiBev’s holdings to bolster its balance sheets and intensify synergies.

“At 19x FY19f PE, Thai Bev is trading at 35% discount to its Asian liquor peers.

At 5% FCF yield and 4% dividend yield, it is a rarity among high-growth consumer names,” says Tiruchelvam.

As at 4.43pm, shares in ThaiBev are trading half a cent lower at 62.5 cents – some 36% off its 52-week peak of 98 cents recorded in November last year.

Source: The Edge

[winston]

not vested

Thai Beverage: Since 2016, beer consumption in Thailand has been affected by the mourning period and excise tax but we expect beer consumption to rebound soon due to improvements in wage growth and the steep rise in the Thailand’s consumer confidence index to a 3-year high in July 2018.

We expect beer consumption to rebound in the coming quarter and efficient marketing strategies to continue capturing market share for the company.

Based on these trends, we continue to maintain a BUY with a SOTP derived target price of $0.75.

Source: KGI

[winston]

not vested

Thai Beverage’s (Thaibev) share price has largely underperformed in 2018 due to a slowdown in consumption in Thailand. The market has been concerned about the weak beer production figures and soft demand.

However, DBS thinks that the slowdown is temporary, and investors should look beyond these issues and position for an eventual recovery.

With elections, the Thai king’s coronation and recovery in farm income, DBS foresees demand for consumption to recover.

DBS also notes that any clarity on plans and benefits from the acquisition of Saigon Beer Alcohol Beverage Joint Stock Company (Sabeco) could also catalyse the share price of Thaibev.

Thaibev is currently trading at 19.8 times forward-FY18 core earnings, which is below its 5-year historical average forward price-to-earnings (P/E) of 21 times.

BUY, TP $0.94; Current share price $0.625

Source: Shares Investment

[winston]

not vested

Thai Beverage: Good things take time

Thai Beverage PLC’s (ThaiBev) FY18 results were below expectations – core PATMI was down 19% YoY to THB 21.0b and came up to 87% of our full-year forecast.

Management attributed the soft results to lackluster demand locally on the back of :-
1) the slow economy,
2) an increase in product prices after the implementation of higher excise tax rates at the end of 2017, and
3) an elderly fund tax at the beginning of 2018.

Domestic spirits and beer volumes were down 12% and 11% YoY respectively.

We continue to be wary on domestic economic weakness and the dampening effect of the increase in excise tax, which we had previously under-estimated.

Nonetheless, valuations continue to be attractive with ThaiBev trading at a FY19F P/E of 15.7x (Bloomberg consensus) as at 26 Nov’s close, more than 1 standard deviation below its 5-year mean and close to its 5y trough of 14.7x.

After adjustments, our fair value decreases from S$0.89 to S$0.85.

Maintain BUY with a fair value estimate of S$0.85.

Source: OCBC

[behappyalways]

ThaiBev 1Q earnings more than double to $321 mil on revenue jump
https://www.theedgesingapore.com/thaibe ... venue-jump

[behappyalways]

ThaiBev 2Q earnings fall 12% to $250 mil due to poorer spirits and food businesses
https://www.theedgesingapore.com/thaibe ... businesses

[behappyalways]

ThaiBev reports 22% rise in 3Q earnings to $302 mil on higher sale volume of spirits and soft drinks
https://www.theedgesingapore.com/capita ... s-and-soft

[behappyalways]

ThaiBev posts 30% rise in FY19 earnings to $1.05 bil on higher revenue
https://www.theedgesingapore.com/capita ... er-revenue

[behappyalways]

ThaiBev said to consider IPO of US$10 bil brewery business: Update

In 2017, ThaiBev’s Vietnamese affiliate agreed to buy a controlling stake in Sabeco, the country’s largest brewer, for about US$4.8 billion.

Although growth in beer consumption is flat or declining across mature markets like the US, Japan and China, Southeast Asia is one of the industry’s bright spots.

An expanding middle class and youthful population drove a 300% surge in beer demand in Vietnam between 2002 and 2017, according to data from Euromonitor International.

Apart from the brewery business, ThaiBev runs distilleries that produce liquor including SongSam rum, Meridian brandy and Drummer whisky.

It owns about 28.5% of Singapore’s Fraser & Neave, which sells 100Plus soft drinks and Magnolia dairy products, data compiled by Bloomberg show.

The group is controlled by Charoen Sirivadhanabhakdi, who is Thailand’s richest person with a net worth of about US$19.5 billion, according to the Bloomberg Billionaires Index.

Source: The Edge

https://www.theedgesingapore.com/news/i ... ess-update