Date: September 23, 2024
Broker: CGS-CIMB Securities

Company Overview

Carabao Group is a Thailand-based beverage company, primarily known for its flagship energy drink, Carabao Dang. The company has established itself as a major player in the domestic energy drink market and is expanding its footprint in international markets, particularly in Southeast Asia.

Domestic Market Performance

Carabao Group’s domestic market share in Thailand reached a record high of 24.8% in August 2024. This robust performance has led to a forecast of historical-high domestic energy drink sales for the third quarter of 2024 (3Q24F). The company’s strong brand presence and growing market share reflect its dominance in the local energy drink segment.

Export Potential

Despite challenges in certain markets, Carabao Group’s export potential remains strong. The company is expecting export sales to Cambodia to grow by 25-30% year-on-year, which will drive an overall overseas sales growth of 13% year-on-year. This growth comes despite facing some challenges in Myanmar, indicating that the company’s international strategy remains resilient and focused on key growth markets.

Investment Recommendation and Target Price

CGS-CIMB Securities has reiterated an “Add” recommendation for Carabao Group with a higher target price of THB85. This bullish stance is based on the company’s solid domestic performance and the expected increase in export sales, particularly in Cambodia.

Conclusion

Carabao Group continues to strengthen its position in the domestic energy drink market while pursuing substantial growth opportunities in international markets. With a record-high market share and a promising export outlook, the company is well-positioned for sustained growth in the coming quarters.

Source: CGS-CIMB Securities, Carabao Group Analysis, September 23, 2024