On Thursday at 11:52 AM (Bangkok time), the share price of Carabao Group Public Company Limited (SET: CBG) rose by 1.83% or THB 1.00 to THB 55.50, with a trading value of THB 85.87 million.
CBG is poised for a strong performance in the second quarter of 2025, with analysts forecasting double-digit earnings growth on the back of solid domestic sales, despite lingering export headwinds in Cambodia and shifting competitive dynamics.
Krungsri Securities (KSS) projects CBG’s core profit to reach THB 762 million in 2Q25, up 10% year-on-year, buoyed by a 13% increase in total sales to THB 5.6 billion. The firm highlights particularly strong domestic energy drink sales—up 25% to THB 1.7 billion—thanks to a 1.2 percentage point gain in local market share to 25.1%. Sales of Khao Hom liquor also soared 25%, hitting THB 2.2 billion, fueled by rising consumer demand.
However, international energy drink sales slipped 2.4% to THB 1.4 billion, dragged down by sluggish demand in CLMV markets, particularly a 10% year-on-year fall in Cambodia, where border closures forced a shift to maritime shipments. The analyst expects benefits from these delayed shipments to reflect in the third quarter.
Gross margin is estimated to narrow slightly to 27.1% due to increased sugar taxes, while selling and administrative expenses relative to revenue are expected to improve to 20.8%. KSS maintains a ‘BUY’ recommendation for CBG, with a THB 97 target price, seeing upside potential from improved distribution and economies of scale.
Finansia Syrus Securities (FSS) has revised its outlook for CBG, noting that second-quarter profit will likely come in slightly below previous estimates due to the temporary closure of the Thai-Cambodian border in June.
This disruption led to a drop in Cambodian revenue—down an estimated 10% quarter-on-quarter and 15% year-on-year—as some orders could not be delivered on time. As a result, second-quarter profit is now projected at about THB 801 million, still up 5% from the prior quarter and 16% year-on-year.
CBG has shifted to shipping goods to Cambodia by sea, with delayed orders now expected to boost third-quarter results. FSS has raised its forecast for Cambodian revenue in the third quarter to 10% growth quarter-on-quarter.
Despite steady demand, the analyst is cautious due to a recent dip in market share in May and ongoing risks if the border issue persists, and recommends CBG for speculative trading given these uncertainties.
CGS International Securities (Thailand) (CGSI) expects CBG’s 2Q25 net profit to surge 21.6% year-on-year to THB 840 million, driven by a 30% jump in domestic energy drink sales and strong gains in alcohol and beer distribution. The robust growth reflects a low base last year due to dealer destocking.
Gross margin is forecast to remain stable at 40.3%, bolstered by lower production costs and efficiency gains, despite the recent sugar tax hike.
CGSI notes that while the domestic outlook is strong, overseas trends vary. Exports are expected to fall 4% year-on-year in the second quarter, driven by weaker sales in Cambodia due to restrictions and border issues.
In contrast, sales in Myanmar are on an upward trend and expected to grow 10% year-on-year ahead of the new factory’s commercial opening in July 2025. However, current production capacity in Myanmar is still limited, meaning continued reliance on exports from Thailand may cap short-term upside. As a result, CGSI projects that international sales will only grow by 5-6% in 2026-2027.
The analyst has revised CBG’s EPS estimates for 2025-2027 down by 3.4-4.3%, citing a maturing domestic market and eroding price advantages as rivals launch competing products. Higher-margin businesses are slowing, while lower-margin distribution expands, potentially capping net profit growth beyond 2025.
Looking ahead, CGSI projects CBG will transition into a high-quality dividend stock, as capital expenditures are expected to decrease rapidly after 2026 and the company has no major growth projects planned in the near term.
Combined with a strong balance sheet and healthy operating cash flow, and with limited investment needs, CGSI forecasts the dividend payout ratio will rise to 80% in 2026 and could reach 90-100% from 2027 onwards. As a result, dividend yield is expected to increase from 3.1% in 2025 to 6.2% in 2027.
The brokerage firm maintains a ‘BUY’ rating on CBG but lowers its target price to THB 69.50, as the company offers attractive risk-adjusted returns based on solid near-term profits and stable long-term income. Meanwhile, the CGSI warns of downside risks from soft Cambodian results and continued margin pressure.
