{"id":326970,"date":"2024-02-29T10:53:27","date_gmt":"2024-02-29T02:53:27","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=326970"},"modified":"2024-02-29T10:53:29","modified_gmt":"2024-02-29T02:53:29","slug":"stock-in-focus-monde-nissin-corp-monde-29-feb-2024-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-monde-nissin-corp-monde-29-feb-2024-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: Monde Nissin Corp. (MONDE) – 29 Feb 2024 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>MONDE<\/td><\/tr>
Company Name<\/strong><\/td>Monde Nissin Corp.<\/td><\/tr>
Broker<\/strong><\/td>RCBC Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>29 Feb 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Hold<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 10.50<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We upgrade our target price (TP) for Monde Nissin (MONDE) by 11% from Php9.50
to Php10.50 as we roll over our DCF valuation using our 2024 10-year EBITDA estimates (up 15% y\/y to Php15.1 billion). <\/p>\n\n\n\n

However, we downgrade our rating from a BUY to HOLD following its surge in stock price \u2013 MONDE is up 21% year-to-date (YTD) and outperforms the PSEi ~14% \u2013 likely due to its positive 2023 preliminary results guidance announced in the latter part of January. <\/p>\n\n\n\n

Although MONDE\u2019s indication of a strong finish in 2023 regained confidence toward the stock, it is still within our expectations and is currently trading close to our fair value estimates, thus warrants a HOLD rating. At our Target Price, the share price upside is 3.6%.<\/p>\n\n\n\n

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

First look at 4Q 2023 preliminary results <\/h3>\n\n\n\n

MONDE provided positive preliminary unaudited 4Q 2023 results in the latter part of January, with the firm expecting a high single-digit y\/y sales growth and mid-teens Year-on-year (y\/y) growth for its core net income. MONDE\u2019s CEO Henry Soesanto stated that 4Q 2023 results reflected the continued strength seen in 3Q 2023, driven by its Asia-Pacific Branded Food and Beverage (APAC BFB) segment. <\/p>\n\n\n\n

Its APAC BFB business saw strong y\/y and quarter-on-quarter (q\/q) topline growth, on strong performances across the board, especially from the noodles and beverages categories. On the other hand, the weak UK retail market prompted MONDE to expect a single-digit decline on its Meat Alternative Business (MAB) topline. Despite that, MONDE anticipates MAB to be EBITDA neutral.<\/p>\n\n\n\n

MAB\u2019s saving grace<\/h3>\n\n\n\n

The annual impairment test in MAB is still ongoing, but MONDE remains keen on
MAB as it believes that any potential impairment at the parent level will be covered
by the shareholder\u2019s financial support. <\/p>\n\n\n\n

Recall that in 9M23, MONDE announced that its major shareholders would provide cash settlement for any cumulative impairment that its Singaporean unit Monde Nissin Singapore Pte Ltd. (MNSPL) will incur from its investment into its UK unit, Monde Nissin UK Ltd. (MNUK), from January 1, 2023 \u2013 December 31, 2032, if a need arises.<\/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>