Here’s How Thai Beverage Public Company Limited Makes Its Money

Thai Beverage Public Company Limited (SGX: Y92) is a company that may be a darling of Singapore’s investors. Why so?

That’s because Thai Beverage’s stock price has climbed by 205% over the last five years, turning every $10,000 investment into $30,500, even before dividends are factored in.

The company’s positive stock market performance prompted me to learn more about the various businesses that are housed within.

Here’s a chart showing a breakdown of the company’s revenue from its fiscal year ended 30 September 2016 (FY16):

Thai Beverage revenue breakdown
Source: Thai Beverage FY16 annual report

There are altogether four business segments within Thai Beverage.

Spirits was by far the biggest revenue contributor. Moreover, it is also the largest generator of operating profit within the group, contributing about THB 18 billion out of Thai Beverage’s total operating profit of THB 19.4 billion in that fiscal year. Thai Beverage also holds a 90% share of the white sprits market in Thailand.

Beer is the next largest revenue segment with a 32% contribution in FY16. It generated THB 3.6 billion in operating profit during the year (operating profits from the Spirits and Beer segments are higher than Thai Beverage’s total operating profit because the other two segments suffered negative operating profit). Under this business segment, the main brand that Thai Beverage focuses on is Chang.

Non-alcoholic beverages is the segment whereby Thai Beverages distributes products such as soft drinks, bottled water, green tea, milk products, and more. As for Food, the segment houses Japanese restaurants and ready-to-cook and ready-to-eat products;

There are a number of moving parts to Thai Beverage’s business as you can see. But, it’s clear that the Spirits business is currently the main profit and revenue driver for the company, followed by the Beer segment at a distant second. It would be interesting to see if the other two segments can start generating meaningful profits in the future.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.