CLSA: Cuts BUD APAC (01876) target price by 29.9% to HK$6.1; weak beer demand leads to lowered earnings estimates

CLSA issued a research report stating that weak demand in the Chinese and South Korean beer markets, low visibility on recovery, and cost factors such as rising aluminum prices have made the bank more cautious about BUD APAC's (01876) revenue and margin outlook for 2027; the bank maintains its "Outperform" rating and cuts its target price by 29.9% from HK$6.1 to HK$6.1. The bank forecasts that BUD APAC's Western APAC sales volume will continue to decline in Q4 this year and in 2027, partly offset by strong growth in India; and expects total revenue to fall 6.9% year-on-year in Q4 this year and 1.3% year-on-year in 2027. In response to weakening operating leverage and rising aluminum costs and transportation expenses, the bank has lowered its margin forecasts, expecting normalized EBITDA to fall 16% year-on-year in Q4 this year and 5% year-on-year in 2027; it has also cut its 2026-2028 forecasts, lowering revenue forecasts by 3% to 7%, non-GAAP normalized EBITDA forecasts by 10% to 17%, and net profit forecasts by 19.2%, 30%, and 29.2%, respectively.