Analysts mostly maintained their ratings on the stock while revising downwards their earnings expectations.
PETALING JAYA: Carlsberg Brewery Malaysia Bhd
(Carlsberg Malaysia), the brewer of the eponymous beer as well as stouts and ciders, is expected to defend margins and profitability through a hike in prices from Sept 1, analysts say
However, dour consumer sentiment and the possibility of a tax on sugary beverages being extended to alcohol and cigarettes also looms over the sector.
While the exact price increases were not disclosed during a briefing announcing the company’s second quarter (2Q25) results on Tuesday, which largely came in within expectations despite the overall drop in revenue and continued weakness in the Singapore market.
Analysts mostly maintained their ratings on the stock while revising downwards their earnings expectations.
UOB Kay Hian Research, which has maintained a “buy” call on the stock but at a lower target price of RM23.30 from RM24.90, has cut Carlsberg Malaysia’s earnings projections for this year (FY25) by 6%, FY26 by 2% and FY27 by 1% on lower sales volume that will be offset by the price increases.
“While the exact quantum of the price rise was not disclosed, we think it would be within the 5% to 8% range, similar to price hikes in previous years.
“Carlsberg Malaysia is hiking prices largely to protect margins following the dour consumer sentiment,” the research house said, adding that margins may improve slightly in the short term, especially given that the announced price hike may result in forward buying ahead of time.
Hong Leong Investment Bank Research, which has maintained a “buy” call on the stock with a lower target price of RM24.14 from RM31.08, said the financial impact from price hikes has been largely neutral due to inelastic demand, with the key risk being a pro-health tax being extended to alcohol.
