Main points of investment
Maintain the "overweight" rating with a target price of HK $27.00. Budweiser Brewing Company APAC Limited is the leading brewer in the beer market in the Asia-Pacific region. We estimate that revenue of 2023 Universe 2024 Universe in 2025 will be US $8.361 billion, which is + 11.7%, 8.1% and 6.9%, respectively, compared with the same period last year. The net profit of homing is US $10.65, 12.60 and 16.2%, respectively, compared with the same period last year. Maintain the "overweight" rating, with a target price of HK $27.00, corresponding to 19.5 times EBITDA in 2023.
Revenue increased slightly and net profit declined. In 2022, the company achieved operating income of US $6.48 billion, which increased by 2.4% year-on-year and 1.7% per 100 liters, mainly due to the effective revenue management measures of the Korean market and the high-end strategy of the Indian market.
Total sales grew by 0.7% for the whole year, and strong growth in South Korea and India flattened the sluggish sales caused by the domestic epidemic. The endogenous cost of sales increased by 8.5% compared with the same period last year, mainly due to the increase in raw materials and packaging costs partly offset by efficiency measures and procurement optimization. The net profit of returning home was US $913 million, down 3.9% from the same period last year.
In 2022, the performance of the domestic business affected by the epidemic was under pressure, and the performance of the Korean and Indian markets was sound.
In the western Asia-Pacific market, sales and revenue per 100 liters fell by 3.6% and 6.2% respectively in the fourth quarter of 2022, while revenue decreased by 9.6%. In 2022, sales and revenue per 100 litres fell by 0.4% and 0.1%, respectively, and revenue decreased by 0.6%. 1) China: in 2022, the areas where the company's business was concentrated were disturbed due to the long-term closure of channels, especially in the fourth quarter, with a major turning point in domestic epidemic prevention measures, with a sharp decline in passenger flow in a short period of time, and high-end sales channels were seriously affected. For the whole year, sales fell 7.0%, while revenue and income per 100 litres fell by 15.0% and 8.6%, respectively. 2) India: leading the industry in fiscal 2022, high-end and ultra-high-end revenue nearly doubled compared with the previous fiscal year, and India has become one of the company's top five markets in terms of sales.
In the eastern Asia-Pacific market, revenue grew by 15.5% in fiscal year 2022, sales increased by 8.9%, revenue per 100 liters increased by 6.1%, and normalized EBITDA grew by 23.9%. The company's business in South Korea retail channels and catering channels continued to grow, the overall market share continued to expand, compared with the previous year growth 1.5pcts, higher than the pre-epidemic level. Product innovation and marketing activities are expected to continue to fuel business growth.
Risk tips: product safety issues; higher-than-expected fierce market competition; new product market promotion is not up to expectations; significant fluctuations in raw material costs.