Calculating The Intrinsic Value Of Thai Beverage Public Company Limited (SGX:Y92)

Key Insights

Using the 2 Stage Free Cash Flow to Equity, Thai Beverage fair value estimate is S$0.48 With S$0.47 share price, Thai Beverage appears to be trading close to its estimated fair value Our fair value estimate is 18% lower than Thai Beverage's analyst price target of ฿0.59

How far off is Thai Beverage Public Company Limited (SGX:Y92) from its intrinsic value? Using the most recent financial data, we'll take a look at whether the stock is fairly priced by projecting its future cash flows and then discounting them to today's value. We will take advantage of the Discounted Cash Flow (DCF) model for this purpose. There's really not all that much to it, even though it might appear quite complex.

Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model.

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What's The Estimated Valuation?

We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.

A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we discount the value of these future cash flows to their estimated value in today's dollars:

10-year free cash flow (FCF) forecast

2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Levered FCF (THB, Millions) ฿36.1b ฿37.9b ฿22.4b ฿19.2b ฿17.5b ฿16.5b ฿15.9b ฿15.7b ฿15.6b ฿15.7b Growth Rate Estimate Source Analyst x4 Analyst x4 Analyst x1 Est @ -14.17% Est @ -9.18% Est @ -5.68% Est @ -3.24% Est @ -1.53% Est @ -0.33% Est @ 0.51% Present Value (THB, Millions) Discounted @ 7.7% ฿33.5k ฿32.7k ฿17.9k ฿14.3k ฿12.0k ฿10.5k ฿9.5k ฿8.7k ฿8.0k ฿7.5k

("Est" = FCF growth rate estimated by Simply Wall St)
Present Value of 10-year Cash Flow (PVCF) = ฿155b

Story Continues

We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.5%. We discount the terminal cash flows to today's value at a cost of equity of 7.7%.

Terminal Value (TV)= FCF2035 × (1 + g) ÷ (r – g) = ฿16b× (1 + 2.5%) ÷ (7.7%– 2.5%) = ฿306b

Present Value of Terminal Value (PVTV)= TV / (1 + r)10= ฿306b÷ ( 1 + 7.7%)10= ฿146b

The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is ฿300b. In the final step we divide the equity value by the number of shares outstanding. Relative to the current share price of S$0.5, the company appears about fair value at a 0.9% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out.SGX:Y92 Discounted Cash Flow November 10th 2025

The Assumptions

We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Thai Beverage as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.7%, which is based on a levered beta of 0.800. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.

Check out our latest analysis for Thai Beverage

SWOT Analysis for Thai Beverage

Strength

Earnings growth over the past year exceeded the industry.

Debt is well covered by earnings.

Dividends are covered by earnings and cash flows.

Weakness

Earnings growth over the past year is below its 5-year average.

Dividend is low compared to the top 25% of dividend payers in the Beverage market.

Opportunity

Annual earnings are forecast to grow faster than the Singaporean market.

Current share price is below our estimate of fair value.

Threat

Debt is not well covered by operating cash flow.

Revenue is forecast to grow slower than 20% per year.

Moving On:

Whilst important, the DCF calculation ideally won't be the sole piece of analysis you scrutinize for a company. DCF models are not the be-all and end-all of investment valuation. Preferably you'd apply different cases and assumptions and see how they would impact the company's valuation. If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Thai Beverage, there are three important items you should consider:

Risks: Every company has them, and we've spotted 2 warning signs for Thai Beverage (of which 1 shouldn't be ignored!) you should know about. Future Earnings: How does Y92's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered!

PS. Simply Wall St updates its DCF calculation for every Singaporean stock every day, so if you want to find the intrinsic value of any other stock just search here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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