In a report released today, Paul Chew from Phillip Securities maintained a Buy rating on Thai Beverage Public Co (TBVPF – Research Report), with a price target of S$0.56.
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Paul Chew has given his Buy rating due to a combination of factors that suggest potential growth for Thai Beverage Public Co. Despite a decline in net profit for the spirits segment, the company showed resilience with a modest recovery in spirit volumes and a notable increase in beer sales in Thailand, driven by tourism. The company’s strategic efforts to reduce marketing expenses and the anticipated decline in commodity prices are expected to improve profit margins.
Additionally, while Sabeco’s performance has been a drag due to intense competition and downtrading, the overall market conditions, including lower packaging and molasses costs, present an opportunity for margin improvement. The company is also expected to navigate the challenging macroeconomic environment by tightening its marketing spend, which could bolster earnings. These factors collectively underpin the Buy rating, as the company is positioned to benefit from both internal cost management and external market conditions.
According to TipRanks, Chew is a 5-star analyst with an average return of 13.8% and a 68.13% success rate.
In another report released today, DBS also maintained a Buy rating on the stock with a S$0.63 price target.
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