FOOD & BEVERAGE | Staff Reporter, Singapore

ThaiBev launches luxury InverHouse whisky portfolio

The offerings focus on Ready to Drink spirits like the Kulov Max 7 vodka.

Thai Beverage has launched the InverHouse whisky portfolio through its channel of luxury hotels and restaurants, extending its reach into the premium segment. It introduced its Ready to Drink (RTD) category of spirits like the Kulov Max 7 vodka and a wine cooler, UOB Kay Hian noted.

According to UOBKH analyst Lucas Teng, the group looks to capitalise on its strong brand recognition by improving on packaging designs and expanding into smaller volume offerings for brands such as Ruang Khao Silver. “The introduction of RTD spirits also caters to the growing niche market segments which have a preference for convenience,” he said.

Meanwhile, the beer market in Thailand remains a competitive environment with ThaiBev continuing to put in efforts to gain brand recognition and market share through experiential platforms of event marketing. “In a recent briefing, management remained positive on its marketing efforts and has cited gains in the recent quarter, with its domestic volume growth (8% YoY) outpacing industry growth (approximately 4% YoY),” Teng said.

ThaiBev looks to build up the next generation of direct sales agents from the current 1,100 sales team. “Overall, the group faced cost pressures in 2H2018, with the beer segment affected by high raw material costs from elevated malt prices,” the analyst added.

Sabeco might be a hidden dragon for ThaiBev, but it is still in its transitional phase. According to Teng, the management is confident of the executional improvements that the company has made since taking over, such as transforming the brand through revamped marketing activities and integration with employees.

“Sabeco can be expected to develop further enhancements in the longer term, such as the optimisation of production facilities and synergistic benefits of procurement with Chang Beer,” Teng said.

Also read: ThaiBev's board injections to boost Sabeco

ThaiBev has four out of the seven board seats and has also appointed three key management personnel. “With greater control in place, management is getting into the nitty-gritty and has started working on implementing good corporate governance,” CGS-CIMB analyst Cezzane See said previously.

ThaiBev has also started assessing ways to improve the capabilities and efficiencies of Sabeco’s supply chain, and improving business productivity with the aim of enhancing market share and earnings.

OCBC Investment Research also expects the management to start implementing efficiency improvements in the next six to twelve months, especially with regards to the procurement of raw materials.

Lastly, ThaiBev’s food segment is expected to continue the momentum of store expansion growth. “The group has added 15 stores in 1QFY2019 and will look to add more stores in the coming year, including the recently acquired KFC franchise,” Teng concluded. 

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