Improving consumption per capita

Investment Thesis

Volume driven by new products and recovering demand. We expect carbonated beverage sales volume to grow by 10% in FY22F, supported by new SKU launches and rising consumption per capita. For comparison, China’s annual consumption per capita of carbonated beverage stood at 5.7 litres versus Singapore’s 14.6 litres, according to Euromonitor.

Average selling price to increase on changing product mix. We forecast ASP to rise by 2%/2% in 2021/22, driven by
product innovation.

Opex savings to offset raw material cost pressures. We are positive on opex savings to offset higher PET and syrup prices in FY21F. We forecast the gross profit margin to contract 1.0ppt and expand 0.5ppt in FY21/22F, while we expect the EBIT margin to stay largely unchanged at ~c.7%.