Heineken Malaysia Berhad (KLSE:HEIM) - Share price, News & Analysis

Q: What is the Fair Price of HEIM when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

HEIM (MYR24) is trading below our estimate of [[fair value]] (MYR27.86)

HEIM fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	4/6
Past Performance	5/6
Financial Health	6/6
Dividends	4/6

HEIM Stock Overview

Heineken Malaysia Berhad, together with its subsidiaries, produces, packages, markets, and distributes alcoholic beverages in Malaysia and the rest of Asia.

Rewards

Trading at 13.9% below our estimate of its fair value

Earnings are forecast to grow 10.3% per year

Earnings grew by 67.2% over the past year

Risk Analysis

Unstable dividend track record

Heineken Malaysia Berhad Competitors

Carlsberg Brewery Malaysia Berhad

KLSE:CARLSBG

RM6.8b

Fraser & Neave Holdings Bhd

KLSE:F&N

RM7.7b

Genting Plantations Berhad

KLSE:GENP

RM5.8b

FGV Holdings Berhad

KLSE:FGV

RM5.5b

Price History & Performance

Summary of all time highs, changes and price drops for Heineken Malaysia Berhad
Historical stock prices
Current Share Price	RM24.00
52 Week High	RM25.18
52 Week Low	RM19.78
Beta	0.43
1 Month Change	-3.15%
3 Month Change	8.89%
1 Year Change	2.56%
3 Year Change	2.30%
5 Year Change	29.87%
Change since IPO	387.81%

Recent News & Updates

May 16

We Think Heineken Malaysia Berhad (KLSE:HEIM) Can Manage Its Debt With Ease

The external fund manager backed by Berkshire Hathaway's Charlie Munger, Li Lu, makes no bones about it when he says...

Shareholder Returns

	HEIM	MY Beverage	MY Market
7D	2.5%	3.0%	-0.9%
1Y	2.6%	-7.3%	-7.7%

Return vs Industry: HEIM exceeded the MY Beverage industry which returned -7.3% over the past year.

Return vs Market: HEIM exceeded the MY Market which returned -7.7% over the past year.

Price Volatility

Is HEIM's price volatile compared to industry and market?
HEIM volatility
HEIM Average Weekly Movement	3.6%
Beverage Industry Average Movement	3.6%
Market Average Movement	5.6%
10% most volatile stocks in MY Market	11.4%
10% least volatile stocks in MY Market	2.8%

Stable Share Price: HEIM is less volatile than 75% of MY stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: HEIM's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1964	510	Roland Bala	https://www.heinekenmalaysia.com

Heineken Malaysia Berhad, together with its subsidiaries, produces, packages, markets, and distributes alcoholic beverages in Malaysia and the rest of Asia. The company offers beers under the Paulaner, Kirin Ichiban, Kilkenny, Edelweiss, Guinness, Tiger, Heineken, and Anchor brand names; ciders under the Strongbow and Apple Fox brands; shandy under the Anglia brand name; and non-alcoholic malt beverage under the Malta brand name. It is also involved in property holding and land development activities.

Heineken Malaysia Berhad Fundamentals Summary

How do Heineken Malaysia Berhad's earnings and revenue compare to its market cap?
HEIM fundamental statistics
Market Cap	RM7.25b
Earnings (TTM)	RM285.52m
Revenue (TTM)	RM2.13b

25.4x

P/E Ratio

3.4x

P/S Ratio

Is HEIM overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
HEIM income statement (TTM)
Revenue	RM2.13b
Cost of Revenue	RM1.47b
Gross Profit	RM658.31m
Other Expenses	RM372.79m
Earnings	RM285.52m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.95
Gross Margin	30.91%
Net Profit Margin	13.41%
Debt/Equity Ratio	3.9%

How did HEIM perform over the long term?

See historical performance and comparison

Dividends

3.4%

Current Dividend Yield

86%

Payout Ratio

Does HEIM pay a reliable dividends?

See HEIM dividend history and benchmarks

When do you need to buy HEIM by to receive an upcoming dividend?
Heineken Malaysia Berhad dividend dates
Ex Dividend Date	Jun 29 2022
Dividend Pay Date	Jul 28 2022
Days until Ex dividend	0 days
Days until Dividend pay date	29 days

Does HEIM pay a reliable dividends?

See HEIM dividend history and benchmarks

We’ve recently updated our valuation analysis.

Valuation

Is HEIM undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HEIM?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for HEIM. This is calculated by dividing HEIM's market cap by their current preferred multiple.
What is HEIM's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	RM7.25b

HEIM key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	3.4x
Enterprise Value/EBITDA	16.4x
PEG Ratio	2.5x

Price to Earnings Ratio vs Peers

How does HEIM's PE Ratio compare to its peers?

HEIM PE Ratio vs Peers

The above table shows the PE ratio for HEIM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	17.1x
CARLSBG Carlsberg Brewery Malaysia Berhad	30.3x	13.6%	RM6.8b
F&N Fraser & Neave Holdings Bhd	22.5x	13.3%	RM7.7b
GENP Genting Plantations Berhad	12x	-19.6%	RM5.8b
FGV FGV Holdings Berhad	3.5x	-41.9%	RM5.5b
HEIM Heineken Malaysia Berhad	25.4x	10.3%	RM7.3b

Forward PE

Price-To-Earnings vs Peers: HEIM is expensive based on its Price-To-Earnings Ratio (25.4x) compared to the peer average (17.1x).

Price to Earnings Ratio vs Industry

How does HEIM's PE Ratio compare vs other companies in the Asian Beverage Industry?

Price-To-Earnings vs Industry: HEIM is expensive based on its Price-To-Earnings Ratio (25.4x) compared to the MY Beverage industry average (25.3x)

Price to Earnings Ratio vs Fair Ratio

What is HEIM's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HEIM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	25.4x
Fair PE Ratio	21.5x

Price-To-Earnings vs Fair Ratio: HEIM is expensive based on its Price-To-Earnings Ratio (25.4x) compared to the estimated Fair Price-To-Earnings Ratio (21.5x).

Share Price vs Fair Value

What is the Fair Price of HEIM when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HEIM (MYR24) is trading below our estimate of fair value (MYR27.86)

Significantly Below Fair Value: HEIM is trading below fair value, but not by a significant amount.

Price to Earnings Growth Ratio

PEG Ratio: HEIM is poor value based on its PEG Ratio (2.5x)

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Future Growth

How is Heineken Malaysia Berhad forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

10.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: HEIM's forecast earnings growth (10.3% per year) is above the savings rate (3.6%).

Earnings vs Market: HEIM's earnings (10.3% per year) are forecast to grow faster than the MY market (9.9% per year).

High Growth Earnings: HEIM's earnings are forecast to grow, but not significantly.

Revenue vs Market: HEIM's revenue (5.7% per year) is forecast to grow faster than the MY market (5.2% per year).

High Growth Revenue: HEIM's revenue (5.7% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: HEIM's Return on Equity is forecast to be very high in 3 years time (90%).

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Past Performance

How has Heineken Malaysia Berhad performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-6.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: HEIM has high quality earnings.

Growing Profit Margin: HEIM's current net profit margins (13.4%) are higher than last year (9.5%).

Past Earnings Growth Analysis

Earnings Trend: HEIM's earnings have declined by 6.9% per year over the past 5 years.

Accelerating Growth: HEIM's earnings growth over the past year (67.2%) exceeds its 5-year average (-6.9% per year).

Earnings vs Industry: HEIM earnings growth over the past year (67.2%) exceeded the Beverage industry -7.8%.

Return on Equity

High ROE: HEIM's Return on Equity (56.1%) is considered outstanding.

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Financial Health

How is Heineken Malaysia Berhad's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: HEIM's short term assets (MYR648.4M) exceed its short term liabilities (MYR523.3M).

Long Term Liabilities: HEIM's short term assets (MYR648.4M) exceed its long term liabilities (MYR32.2M).

Debt to Equity History and Analysis

Debt Level: HEIM has more cash than its total debt.

Reducing Debt: HEIM's debt to equity ratio has reduced from 21% to 3.9% over the past 5 years.

Debt Coverage: HEIM's debt is well covered by operating cash flow (1892%).

Interest Coverage: HEIM's interest payments on its debt are well covered by EBIT (172.2x coverage).

Balance Sheet

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Dividend

What is Heineken Malaysia Berhad current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.37%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: HEIM's dividend (3.37%) is higher than the bottom 25% of dividend payers in the MY market (2.1%).

High Dividend: HEIM's dividend (3.37%) is low compared to the top 25% of dividend payers in the MY market (4.94%).

Stability and Growth of Payments

Stable Dividend: HEIM's dividend payments have been volatile in the past 10 years.

Growing Dividend: HEIM's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: At its current payout ratio (85.7%), HEIM's payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: At its current cash payout ratio (89.6%), HEIM's dividend payments are covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

3.2yrs

Average management tenure

CEO

Roland Bala (55 yo)

3.75yrs

Tenure

RM3,544,000

Compensation

Mr. Roland Bala has been Managing Director at Heineken Malaysia Berhad since September 1, 2018 and also its Non-Independent Executive Director since September 1, 2018. Mr. Bala served as General Manager of...

CEO Compensation Analysis

Compensation vs Market: Roland's total compensation ($USD804.54K) is above average for companies of similar size in the MY market ($USD502.80K).

Compensation vs Earnings: Roland's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: HEIM's management team is considered experienced (3.2 years average tenure).

Board Members

Experienced Board: HEIM's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/28 00:00
End of Day Share Price	2022/06/28 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31