The spirits business is Thaibev’s strong cash cow, contributing the largest part of revenue and EBITDA.
“As Thaibev owns more than 90% market share of spirits consumption in Thailand, we expect its spirits sales to grow amid resilient demand as consumers could switch among a wide range of products at different price points,” says UOB.
Meanwhile, Thaibev has successfully regained its beer market share since the new version of Chang beer was launched on Aug 15, climbing to above 40% in 1Q17 from below 30% before the campaign started.
“We expect this positive trend to continue and Chang beer should be able to grow its market share further,” says the analyst.
Koosakulnirund forecasts THBEV to post a 10% revenue CAGR in FY16-19, driven by the beer business. "Overall gross margin is expected to be maintained at a healthy level of around 30%. We forecast a 9% net profit CAGR in FY16-19,” he adds.
Shares of Thaibev are trading at 94 cents.
