{"id":323453,"date":"2023-05-31T00:04:23","date_gmt":"2023-05-30T16:04:23","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=323453"},"modified":"2023-05-31T00:44:32","modified_gmt":"2023-05-30T16:44:32","slug":"stock-in-focus-emperador-inc-emi-31-may-2023-by-regina-capital-development-corp","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-emperador-inc-emi-31-may-2023-by-regina-capital-development-corp\/","title":{"rendered":"Stock in Focus: Emperador Inc. (EMI) – 31 May 2023 by Regina Capital Development Corp."},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>EMI<\/td><\/tr>
Company Name<\/strong><\/td>Emperador Inc.<\/td><\/tr>
Broker<\/strong><\/td>Regina Capital Development Corp.<\/td><\/tr>
Opinion Issued on<\/strong><\/td>31 May 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Hold<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 21.72<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

We retain our HOLD recommendation for EMI, derived from our discounted cash flow (DCF) model with a Target Price of P21.72 per share. <\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

Emperador, Inc. (EMI) saw its net profits improve +7.49% year-on-year (y\/y) to P2.92 billion as it sees revenues rising +15% y\/y to P20.16 billion on strong brandy performance. Its bottomline for the full year however is flattish, up slightly by 1.29% y\/y to P10.1 billion.
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Gross profit margin (GPM) declines on higher cost of goods, which mainly was attributed due to the high inflation environment. Higher OPEX pushed EBITDAs to decline by -9.3% y\/y to P13.81 billion. Higher OPEX is in response to the reopening of economies following the pandemic. Selling and distribution expenses were up +28% to P6.2 billion, particularly on advertising related expenses. A&P expenses for 2022 were up +38.17% y\/y as the company ramps up to promote its brand as economic activity started to return.<\/p>\n\n\n\n

Management expects 2023 to be above 2019 levels as travel retail reopens. The company expects the return of Mainland Chinese travelers this year to contribute to the company\u2019s performance. EMI is keen on its goal of 50\/50 split on revenue from its brandy and whisky business. Currently, brandy accounts for 65% of revenue and 35% is from whisky. Whisky exhibited a larger increase of +18% y\/y compared to brandy at +9% y\/y. This grew on the higher sales of single malt whiskeys. Under the high margin branded business, this segment is less vulnerable to inflation.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>