DBS: Lower target price of BUD APAC (01876) to 9.4 Hong Kong dollars, maintain "buy" rating.

DBS Bank released a research report stating that the demand from mainland Chinese consumers for BUD APAC (01876) has not substantially improved, but sales trends have gradually improved since the first quarter due to a low base comparison. The bank expects the sales decline in the second quarter in the Asia-Pacific region to narrow to 6%. The bank has lowered its profit forecast for 2025 and 2026 by 12% and 17% respectively due to continued sales pressure and the impact of channel transformation on average selling prices in the short term. However, the bank maintains a "buy" rating due to low channel inventory and continuous expansion in the home channel; the target price has been lowered from HK$10.2 to HK$9.4. Due to the continuous shift of on-the-go channels to home channels and weaker performance in top-tier cities, AB InBev's average selling price is under pressure; the bank expects a 2% decline in average selling prices in the Asia-Pacific region in the second quarter, with sales and average selling prices expected to decline by 3% and 2% for the full year. In South Korea, the bank expects a mid-single-digit decline in sales and a low-single-digit increase in average selling prices in the second quarter, but EBITDA in the Asia-Pacific East region will be under pressure due to shrinking sales and deleveraging of related costs.