Venture is currently producing “heat not burn” tobacco products IQOS 2.4+ and IQOS 3 products while Flex is currently producing IQOS 2.4+ and IQOS 3 Multi products. From what UOB understands, Philip Morris is likely to introduce a third manufacturer which will likely produce IQOS 2.4+.
SINGAPORE (Dec 6): UOB KayHian is maintaining Venture Corp at “sell” given increasing risk production share of IQOS (I quit ordinary smoking) devices could be shifted away to another contract manufacturer by Philip Morris which is seeking to improve economics.
In a Thursday report, analyst Foo Zhi Wei says UOB channel checks into the IQOS supply chain indicate that the second manufacturer, Flex has reached the supplier concentration limit for Philip Morris although UOB was not able to ascertain as to whether Venture has similarly hit a production ceiling.
