Sharing the earnings update note published by DBS overnight - 

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Don&rsquo t be dispirited, have a cold beer

• 1Q25 revenue at THB92.3bn, up 2.4% y/y, forming 26% of our estimates, in-line
• 1Q25 EBITDA at THB16.4bn, down 0.8% y/y, forming 25.6% of our estimates, below estimates
• Based on readthrough from SABECO, Thai beer likely saw strong top-line and EBITDA growth, supporting case of Beer Co IPO
• Maintain BUY with TP at SGD0.77

What&rsquo s New

ThaiBev&rsquo s 1Q25 revenue rose 2.4% y/y to THB92.3bn, while EBITDA declined 0.8% y/y to THB16.4bn. Beer (+8.0% y/y) and non-alcoholic beverage (NAB) (+7.2% y/y) drove growth, while spirits fell 4.8% y/y. EBITDA growth was strong in beer (+16.6%), benefiting from margin expansion due to lower raw material costs and efficient advertising spend. NAB also saw strong EBITDA growth (+15.6%) and benefited from margin expansion driven by improved production efficiency and a favourable cost environment. However, the strong growth was offset by a 12.0% y/y EBITDA decline in spirits, where higher raw material costs and increased marketing expenses pressured margins.

Our views

1Q25 EBITDA reached 25.6% of estimates, behind the 28.0% contribution in 1Q24. Spirits&rsquo weakness will likely be top of mind, but we anticipate sequential margin improvement as lower molasses costs filter through. While no geographical beer breakdown was provided, SABECO&rsquo s 5% top-line growth and 7% EBITDA decline for the quarter suggests that Thai beer performed well, likely delivering > 8% top-line growth and > 17% EBITDA growth. This strengthens the case for a Beer Co IPO materialising. We maintain our BUY call, TP SGD0.77.

Sharing the earnings update note published by DBS overnight - 

----

Don&rsquo t be dispirited, have a cold beer

• 1Q25 revenue at THB92.3bn, up 2.4% y/y, forming 26% of our estimates, in-line
• 1Q25 EBITDA at THB16.4bn, down 0.8% y/y, forming 25.6% of our estimates, below estimates
• Based on readthrough from SABECO, Thai beer likely saw strong top-line and EBITDA growth, supporting case of Beer Co IPO
• Maintain BUY with TP at SGD0.77

What&rsquo s New

ThaiBev&rsquo s 1Q25 revenue rose 2.4% y/y to THB92.3bn, while EBITDA declined 0.8% y/y to THB16.4bn. Beer (+8.0% y/y) and non-alcoholic beverage (NAB) (+7.2% y/y) drove growth, while spirits fell 4.8% y/y. EBITDA growth was strong in beer (+16.6%), benefiting from margin expansion due to lower raw material costs and efficient advertising spend. NAB also saw strong EBITDA growth (+15.6%) and benefited from margin expansion driven by improved production efficiency and a favourable cost environment. However, the strong growth was offset by a 12.0% y/y EBITDA decline in spirits, where higher raw material costs and increased marketing expenses pressured margins.

Our views

1Q25 EBITDA reached 25.6% of estimates, behind the 28.0% contribution in 1Q24. Spirits&rsquo weakness will likely be top of mind, but we anticipate sequential margin improvement as lower molasses costs filter through. While no geographical beer breakdown was provided, SABECO&rsquo s 5% top-line growth and 7% EBITDA decline for the quarter suggests that Thai beer performed well, likely delivering > 8% top-line growth and > 17% EBITDA growth. This strengthens the case for a Beer Co IPO materialising. We maintain our BUY call, TP SGD0.77.