Summary:
FEH trades at attractive 16x FY26F PE, 3.1x PEG, 3.8% Dividend Yield, 9.8x EV/EBITDA and 2x EV/Sales. Through record coffee prices and Russia noise (33% of revenue), vertical integration and disciplined capacity growth drove record US$577m revenue (US$242m in 2016, ~10.5% CAGR) and an all-time-high S$0.12 payout (pre-bonus) in FY25.
- Platform for US$1bn revenue. 60% of Russia’s 3-in-1, #3 in Vietnam, 10→11 plants in six countries. Current trajectory and the upstream Vietnam freeze-dried plant (2028) put US$1bn revenue in reach by 2030 on continued above-trend execution.
- Rising mid-term macro risks from Iran conflict/global Oil Shock scenario augurs well for FEH as expected higher energy prices supports stronger Rouble outlook and upside risks to our forecast ROAE of 19.5% FY26F.
- BUY, TP S$2.74. 260% 5-year Total shareholder return; +17% forecast FY26F TSR for target price of S$2.74 (implied 18.7x FY26F PE, 3.1x PEG, 9.4x EV/EBITDA, 2.3x EV/Sales).
George.Koh@rhtgoc.com
Paul.Schymyck@rhtgoc.com
