UPC Earnings: Aided by Higher Beverage Sales and Input Cost Tailwinds; Retain Fair Value Estimate

No-moat Uni-President China’s third-quarter earnings were largely in line with our estimates, although sales growth was slightly higher than our expectations. Net profit growth was mostly driven by improving utilization and input cost tailwinds, which is consistent with our view. As such, we maintain our 2024 net income forecast and fair value estimate of HKD 6.80 per share, which implies 15 times 2025 price/earnings, 8 times enterprise value/EBITDA, and a 6.5% dividend yield. We think shares are fairly valued currently.