KUALA LUMPUR (Nov 11): Shares of Carlsberg Brewery Malaysia Bhd (KL:CARLSBG) rose to a three-week high, after the brewer reported a better-than-expected third quarter, while analysts raised their earnings forecasts.

Carlsberg rose as much as 60 sen to an intra-day high of RM20.12, its highest since Oct 17, 2024. At noon market break, the stock was up 48 sen or 2.46% at RM20 per share, giving the company a market capitalisation of RM6.12 billion. Trading volume totalled 133,600 shares so far.

Core net profit for January-September accounted for 77% of consensus’ full-year expectations.

“We expect the upcoming quarter to be seasonally stronger amid festive seasons,” Hong Leong Investment Bank said in a note on Monday. The house also raised its earnings forecasts to account for higher selling prices, strong pickup in Sapporo sales, and favourable consumption outlook.

For next year, the house expects the full impact of an increase in selling prices and stronger disposable income outlook to drive further earnings growth. Further, stronger ringgit should alleviate cost pressures, further reinforcing the outlook on margin, it said.

Shares of Carlsberg have gained more than 5% so far this year, outperforming rival Heineken Malaysia Bhd (KL:HEIM) and the broader consumer sector, thanks to the strong earnings.

All eight research firms covering Carlsberg have “buy” calls on the stock, according to Bloomberg. The consensus 12-month target price is RM24.27, implying a potential 21% gain from current price.

Maybank Investment Bank (Maybank IB) also expects the sales momentum to continue into the final quarter of the year, aided by higher consumer spending towards the year end, and as consumers buy ahead of the Chinese New Year festivity celebrated earlier in January 2025.

“That said, higher advertising and promotional expenses during the upcoming festive seasons could lead to softer earnings quarter-on-quarter,” the house said. All in, Maybank IB lifted its earnings estimates for FY2024 by 11%, and 9% for FY2025.

Net profit for the three months ended Sept 30, 2024 (3QFY2024) climbed nearly 20% to RM90.96 million, from 3QFY2023, on better-than-expected margins. Revenue for the quarter grew 8.3% year-on-year to RM555.93 million.

The brewer declared a third interim dividend of 23 sen per share, for a total distribution of RM70.32 million, higher than the 19 sen per share it paid in the comparable period last year. The latest payout raised its year-to-date dividend to 65 sen, versus 62 sen in the same period last year.