Carabao Group Public Company Limited (SET: CBG) is bracing for a challenging third quarter of 2025, with analysts from Kiatnakin Phatra Securities (KKPS) forecasting weaker results primarily due to reduced sales in Cambodia.
The anticipated 3Q25 pre-exceptional profit is projected at THB 630 million, down 15% year-on-year and 21% quarter-on-quarter, as the Thailand-Cambodia conflict has led to a 43% year-on-year drop in overseas sales. Despite this setback, total revenue is still expected to rise by 8% year-on-year, supported by robust 22% growth in domestic sales, a 29% increase in distribution revenue, and an 18% rise in packaging sales.
However, the reduced contribution from high-margin overseas businesses is anticipated to drag gross margin down to 25.5%, compared to 28.1% in 3Q24. At the same time, selling, general, and administrative (SG&A) expenses are forecast to rise to 12.0% of sales, up from 11.3% a year earlier, due to increased domestic marketing efforts.
KKPS expects CBG’s performance to bottom out in 3Q25, with a recovery likely from 4Q25 onwards. This rebound is anticipated as conditions for Thai products in the Cambodian market improve, while Carabao’s factory in the neighboring country is set to be completed by year-end, enabling considerable cost savings.
In the domestic market, Carabao’s strong brand presence in the THB 10 segment has helped lift its market share to 26.7% in 3Q25, despite intensifying competition from Osotspa (SET: OSP). The analyst notes that CBG should remain relatively unaffected, given its rising dominance in traditional trade channels, which make up the majority of domestic energy drink sales, since the beginning of the year.
Following a downward revision of 2025/26 earnings estimates by 8% and 9%, KKPS has cut its target price for Carabao Group to THB 62 per share (from THB 68), while reiterating a ‘Buy’ rating based on expected operational improvement from late 2025 onwards.
