Although Thailand’s economic data was largely modest in the first quarter, Thai Beverage posted a decent set of 1Q15 results. Driven by growth across all segments, overall revenue increased 11.4% YoY to THB45.7b, which formed 26.6% of our FY15 forecast. Both of its alcoholic segments saw an improved bottom-line, while nonalcoholic beverages division continued to see a net loss and the food business had a lower net profit.

The group’s PATMI gained 10.2% YoY to THB6.6b, comprising 28.7% of our full-year forecast. Stripping out the net gain on foreign exchange, estimated core PATMI saw a 9.2% YoY increase. With regards to a 0.92x current ratio as at end Mar-15, management stated that they will restructure THB25b of short-term loans within June-15 via the issuance of long-term bills of exchange and long-term loans from several financial institutions, slated for repayment during 2016-2018. We maintain our BUY rating with fair value estimate of S$0.80 for now, pending more information from management after trading close today.

Source: OCBC Research - 15 May 2015