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Research by CGS
Add (previously Hold) – TP RM9.77

“Bottoming earnings with good yields"

■ We resume coverage on BAT with an Add rating and a lower GGM-based TP of RM9.77. BAT’s earnings should bottom in FY24F, in our view.
■ We believe BAT’s investments in and launching of its own vape brand, Vuse, in 3Q23 should help its earnings turn around from FY25F onwards.
■ At 10.8x FY26F P/E, valuations are undemanding, supported by FY24-26F yields of 8-9%. This note marks the transfer of coverage to Lew Cheng Wei.

Analysts:
LEW Cheng Wei
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Prem JEARAJASINGAM
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$KLSE-BAT
Research by CGS
Add (previously Hold) – TP RM9.77

“Bottoming earnings with good yields"

■ We resume coverage on BAT with an Add rating and a lower GGM-based TP of RM9.77. BAT’s earnings should bottom in FY24F, in our view.
■ We believe BAT’s investments in and launching of its own vape brand, Vuse, in 3Q23 should help its earnings turn around from FY25F onwards.
■ At 10.8x FY26F P/E, valuations are undemanding, supported by FY24-26F yields of 8-9%. This note marks the transfer of coverage to Lew Cheng Wei.

Analysts:
LEW Cheng Wei
chengwei.lew@cgsi.com
Prem JEARAJASINGAM
prem.jearajasingam@cgsi.com

$BAT / 4162 (BRITISH AMERICAN TOBACCO (MALAYSIA) BERHAD)