Thai Beverage Poised for Strong Growth as Thailand Eases Alcohol Restrictions

CGS International Research | March 21, 2025

Solid Start to the Year for Thai Beverage

Thai Beverage (THBEV) is off to a strong start in 2025, with tourist arrivals in Thailand and Vietnam seeing significant increases during the Lunar New Year and Tet holiday seasons.
Thailand’s tourist arrivals rose 6% year-over-year in January-February 2025, driven by a robust Lunar New Year period.
Vietnam also benefited from an influx of tourists from China, South Korea, and Taiwan during the Tet holiday, with visitor arrivals up 30% year-over-year.
This improving tourist activity is expected to support a 7% year-over-year increase in beer sales volumes for THBEV in the 2025 fiscal year.

Thailand Plans to Ease Restrictive Alcohol Laws

On March 19, 2025, Thailand’s House of Representatives passed a bill to lift restrictions on alcohol sales before 11 am and between 2 pm and 5 pm, as well as ease advertising regulations. This is part of the government’s push to spur tourism and achieve its target of 40 million visitors in 2025, a 13% year-over-year increase.
If approved by the Senate, the removal of the alcohol sales ban is expected to provide an incremental uplift to THBEV’s beer volumes starting in the first quarter of fiscal year 2026.
There is also a possibility of relaxing the current ban on alcohol sales during Buddhist holidays by allowing limited sales in specific tourist hotspots, which could benefit THBEV in the fourth quarter of fiscal year 2025 if approved sooner than expected.

Aggressive Promotions to Continue in Fiscal Year 2025

THBEV’s Chang beer brand had the second-largest market share in Thailand at 40% as of 2024, supported by the company’s strong distribution network and targeted marketing campaigns.
The company is expected to maintain its aggressive promotional spend to gain market share ahead of the easing of alcohol restrictions, which could keep THBEV’s EBITDA margins broadly flat year-over-year in fiscal year 2025 at 18%.

Reiterating Add Rating with Unchanged Target Price

CGS International maintains its Add rating on THBEV, with an unchanged target price of S$0.58. Key catalysts include stronger margins from lower input costs and cost controls, as well as higher volume growth from the relaxation of alcohol sales restrictions. Downside risks include macroeconomic weakness impacting sales volumes and lower margins due to higher SG&A spending.

Peer Comparison

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