GTHT Securities has released a research report maintaining an "Overweight" rating on IFBH (06603). The firm has revised down its EPS forecasts for 2026 and 2027 to $0.12 and $0.15, respectively, from previous estimates of $0.20 and $0.26. It has also introduced a new 2028 EPS forecast of $0.19. Based on comparable company valuations, a P/E ratio of 18x (2026E) is applied, resulting in a target price of HK$16.85 per share, calculated using an exchange rate of USD/HKD 7.80.
Revenue remained stable, but profit was significantly pressured by currency fluctuations and one-time expenses. The company disclosed its 2025 performance, achieving revenue of $176 million, a year-on-year increase of 11.89%. However, due to the appreciation of the Thai Baht against the US dollar and negative impacts from product mix, the gross profit margin declined by 3.82 percentage points. Additionally, the sales expense ratio increased by 1.61 percentage points, primarily due to higher freight costs and exchange rate volatility. The marketing expense ratio rose by 2.71 percentage points, mainly attributed to brand fees for the Teenage Era Boys group. The administrative expense ratio increased by 2.51 percentage points, largely from expenses related to the stock exchange listing. Furthermore, the income tax rate increased by 3.35 percentage points due to a rise in non-deductible expenses. Consequently, the net profit margin attributable to shareholders decreased by 8.23 percentage points to 12.91%, resulting in a net profit of $22.77 million, a year-on-year decline of 31.66%.
The IF brand demonstrated strong performance, while Innococo was a significant drag. In 2025, the IF brand performed robustly, benefiting from sustained investment in brand building, offline activations, and consumer education. Its annual revenue grew by 26.95% to $167 million, significantly outpacing the industry average. The coconut water sector is expected to maintain favorable growth momentum, and the IF brand still possesses considerable room for further market penetration, supporting a positive outlook for its steady future growth. The Innococo brand faced substantial pressure in 2025, with revenue declining by 63.15% to $9.67 million due to internal distributor issues and delays in launching new sports beverages. However, the company has implemented corrective measures to address these problems, and a return to growth is anticipated for Innococo.
International markets delivered impressive results, with continued distribution expansion. The company's international performance was notable in 2025, particularly in Australia where revenue grew by over 150%, and in the Philippines and Laos, where revenue approximately doubled. The company will continue to focus on mature coconut water markets with high per capita consumption, such as Australia and Indonesia. Furthermore, the distribution network continues to expand. The distributor network in mainland China increased from three to seven partners. Innococo has entered into strategic cooperation agreements with COFCO and Watsons, and the establishment of IFB China represents a significant milestone for local operations in the Chinese market. Continued strategic efforts are expected to further unlock market potential.
Key risks include food safety issues, demand falling short of expectations, and cost fluctuations.