TRIS Rating Co., Ltd. has affirmed the company rating of Thai Beverage PLC (ThaiBev) at "A+". At the same time, TRIS Rating has assigned the ratings to ThaiBev's proposed up to Bt10,000 million senior guaranteed debentures due in 2007-2008 at "A+" and due in 2006 at "T1". The outlook remains "stable". The ratings reflect the dominant position of the ThaiBev Group in the Thai alcoholic beverage market, its experienced and capable management team, and economies of scale benefiting from being the largest brewery and distiller. The ratings also take into consideration the company's strong and stable cash flow generation and an extensive distribution network. These strengths are partially offset by the intense competitive environment and regulatory risk that could slow down the growth of alcoholic beverage consumption.
TRIS Rating said that the "T1" short-term rating for ThaiBev's proposed short-term debentures is based largely on the company rating but also reflects the group's sufficient credit facilities worth more than Bt10,000 million and the group's strong internal cash generation of more than Bt10,000 million per annum.
The "stable" outlook for ThaiBev is based on the expectation that the company will maintain its competitiveness and its leading position in the beer and spirits market. However, the company will face high competition from both Thai beer brewers and importers of spirits due to industry liberalization, ASEAN Free Trade Area (AFTA) and Free Trade Agreements (FTA) schemes.
TRIS Rating reported that ThaiBev is a holding company that controls 63 companies. The group produces and distributes a wide variety of alcoholic beverages including beer, traditional white spirits, brown spirits, admixed whisky, Chinese herb spirits and Japanese spirits. The brands in its portfolio, such as Mekhong, Sang Som, and Ruang Khao for spirits and Chang for beer, are well-known in the local market. The majority of ThaiBev's brands target the economy segment of the alcoholic beverage market, which clearly is the largest segment. ThaiBev's portfolio sales strategy, which encouraged agents to purchase the entire product portfolio, helped Chang beer vault to the top of the market within five years of its launch in 1995. Although ThaiBev has sustained its leading position in the Thai beer market, the company's beer sales have slowed after the group changed its marketing policy whereby agents purchase products individually rather than purchase the entire portfolio. As a result, Boon Rawd Brewery Group, ThaiBev's major competitor, has regained some market share. Currently, ThaiBev dominates the domestic market with a 60% market share in beer and a 74% share of total spirits market.
The proposed debentures of ThaiBev are part of a refinancing scheme to repay short-term loans worth Bt36,600 million that will mature in March 2006. The company also plans to refinance the remaining portion of Bt26,600 million with long-term loans from financial institutions, said TRIS Rating. -- End
Thai Beverage PLC (ThaiBev) Company Rating: Affirmed at A+ Issue Ratings: Up to Bt10,000 million senior guaranteed debentures: - Senior guaranteed debentures due 2007-2008 A+ - Senior guaranteed debentures due 2006 T1 Rating Outlook: Stable
TRIS Rating said that the "T1" short-term rating for ThaiBev's proposed short-term debentures is based largely on the company rating but also reflects the group's sufficient credit facilities worth more than Bt10,000 million and the group's strong internal cash generation of more than Bt10,000 million per annum.
The "stable" outlook for ThaiBev is based on the expectation that the company will maintain its competitiveness and its leading position in the beer and spirits market. However, the company will face high competition from both Thai beer brewers and importers of spirits due to industry liberalization, ASEAN Free Trade Area (AFTA) and Free Trade Agreements (FTA) schemes.
TRIS Rating reported that ThaiBev is a holding company that controls 63 companies. The group produces and distributes a wide variety of alcoholic beverages including beer, traditional white spirits, brown spirits, admixed whisky, Chinese herb spirits and Japanese spirits. The brands in its portfolio, such as Mekhong, Sang Som, and Ruang Khao for spirits and Chang for beer, are well-known in the local market. The majority of ThaiBev's brands target the economy segment of the alcoholic beverage market, which clearly is the largest segment. ThaiBev's portfolio sales strategy, which encouraged agents to purchase the entire product portfolio, helped Chang beer vault to the top of the market within five years of its launch in 1995. Although ThaiBev has sustained its leading position in the Thai beer market, the company's beer sales have slowed after the group changed its marketing policy whereby agents purchase products individually rather than purchase the entire portfolio. As a result, Boon Rawd Brewery Group, ThaiBev's major competitor, has regained some market share. Currently, ThaiBev dominates the domestic market with a 60% market share in beer and a 74% share of total spirits market.
The proposed debentures of ThaiBev are part of a refinancing scheme to repay short-term loans worth Bt36,600 million that will mature in March 2006. The company also plans to refinance the remaining portion of Bt26,600 million with long-term loans from financial institutions, said TRIS Rating. -- End
Thai Beverage PLC (ThaiBev) Company Rating: Affirmed at A+ Issue Ratings: Up to Bt10,000 million senior guaranteed debentures: - Senior guaranteed debentures due 2007-2008 A+ - Senior guaranteed debentures due 2006 T1 Rating Outlook: Stable