ANALYSTS POSITIVE ON F&N'S OUTLOOK DESPITE LOWER 2Q FY2025 NET PROFIT

KUALA LUMPUR, April 29 (Bernama) -- Analysts remained positive on Fraser & Neave Holdings Bhd’s  (F&N) outlook despite the company reporting a lower net profit for the second quarter ended March 31, 2025 (2Q FY2025).

F&N’s 2Q FY2025 net profit fell to RM140.34 million from RM165.41 million in the same quarter last year, while revenue was also slightly lower at RM1.33 billion versus RM1.35 billion previously.

In a note today, MIDF Amanah Investment Bank Bhd said it remained optimistic about the company’s prospects, anchored by its strong earnings, defensiveness and resilient consumer base.

It said demand for essential food and beverage products remains stable despite inflationary pressures and global macro uncertainties, reinforcing its position as a dependable consumer staple.

“The group continues to benefit from robust demand for ready-to-drink beverages and a recovery in tourism across Malaysia and Thailand, which supports out-of-home consumption trends.

“Over the longer term, growth will be underpinned by its integrated dairy farm in Gemas, strengthening supply chain resilience and enabling F&N to capture opportunities within Malaysia’s underserved fresh milk market,” it added.

MIDF said it also maintained its earnings forecasts on F&N as the group’s for the first half of 2025 (1H FY2025) results align with expectations and remained its target price (TP) at RM32.68, with a ‘buy’ call on the food and beverage (F&B) company.

For 1H FY2025 ended March 31, 2025, F&N’s net profit fell to RM309.36 million against RM336.15 million in the previous corresponding period, while revenue increased by 1.4 per cent to RM2.72 billion compared with RM2.69 billion in the same period previously.

Meanwhile, CIMB Investment Bank Bhd said it expects F&N to post slightly weaker half-on-half results in 2H FY25F, as the recovery in Indochina sales is likely to be offset by start-up losses from their dairy venture and higher input costs.

“Despite this, we maintain our ‘buy’ rating and TP of RM29.70 on F&N, supported by its attractive valuation of 17.9 times the projected earnings for the calendar year 2025 (CY25F P/E), which represents a 10.5 per cent discount to the company’s average P/E over the past five years.

“With 1H FY2025 results in line, we make no changes to our FY2025-2027F earnings per share for F&N,” it added.

CIMB Investment Bank said it continues to like F&N for its strong market positioning in the F&B space of Malaysia and Thailand, with its established brands, defensive demand for its products, and strong track record.

-- BERNAMA