"With the beer sector already facing a challenging outlook, we reckon that Thai Beverage is likely to fully pass on the higher excise tax to consumers, resulting in softer beer volumes," state the analysts in their June 16 note, where they have kept their "hold" call.
UOB Kay Hian analysts Llelleythan Tan Yi Rong and Heidi Mo have lowered their target price for Thai Beverage (SGX:Y92
) from 51 cents to 45 cents, following news that Vietnam, one of the key markets for the company's beer business, will see higher consumption tax.
The revised tax from 65% to 70% is a bid to curb alcohol consumption in southeast Asia's second-largest beer market. This tax will be increased gradually to 90% in 2031.
