BUD APAC(HK:01876) EBSCN·2024-03-03 16:00Investment Rating - The report maintains a rating of "Buy" for Budweiser APAC (1876.HK) [5] Core Views - The company achieved a revenue of USD 6.856 billion in 2023, with a year-on-year growth of 5.8%. The EBITDA for the same period was USD 2.030 billion, reflecting a year-on-year increase of 4.9% [5][9] - The company is focusing on high-end product development, with significant price increases in key markets, particularly in Asia [6][7] - The report highlights the impact of a non-recurring tax audit claim in South Korea, which resulted in an expense of approximately USD 66 million, affecting net profit [6][7] Financial Performance - In 2023, Budweiser APAC's total sales volume was 9.2767 million kiloliters, with a year-on-year growth of 4.6%. The average price per ton of beer increased by 6.2% for the year [6] - The company reported a gross margin of 50.4% for the full year 2023, with an EBITDA margin of 29.5% [6][9] - The revenue and EBITDA for Q4 2023 were USD 1.293 billion and USD 266 million, respectively, with year-on-year growth rates of 8.9% and 31.3% [5][6] Regional Performance - In the Western Asia region, Q4 2023 revenue and EBITDA grew by 9.2% and 35.7% year-on-year, despite a slight decline in sales volume [6] - The Eastern Asia region saw a revenue and EBITDA increase of 7.7% and 23.2% year-on-year, with a sales volume decline of 3.4% [6] - The Chinese market showed strong performance in high-end products, with revenue growth of 11.1% and EBITDA growth of 44.4% in Q4 2023 [7] Future Outlook - The company plans to expand its distribution channels in China, increasing the number of cities for Budweiser distribution from 220 to 235 by the end of 2024 [7] - The report projects a decrease in net profit for 2024 and 2025 to USD 1.040 billion and USD 1.176 billion, respectively, due to ongoing challenges in the South Korean market [8][9] - The estimated P/E ratios for 2024, 2025, and 2026 are 21x, 19x, and 17x, respectively, indicating a favorable valuation for long-term investors [8]