ThaiBev's dreams of bigger market share in Thailand could become a nightmare

100Plus only captured 1-2% market share in Thailand.

Other than the marketing push on the new beer packaging, Thai Beverage is also pushing its non-alcohol segments. Earlier in the year, it launched 100Plus into Thailand, positioning 100Plus in the CSD (carbonated soft drinks) segment.

100Plus was launched in Feb 15 and initial indications from the agent level have been positive, said CIMB in a report.

Kenneth Ng, analyst at CIMB explanined in that 100Plus was positioned as a functional carbonated soft drink, because the addressable market for CSD is much bigger than the energy drink market. Also, the relatively small energy drink market is dominated by M150 and Carabao, and is a different product altogether vs. 100Plus.

One of the issues with weak profitability in Thai Beverage / Serm Suk’s CSD facilities however is poor utilisation, he said.

"Serm Suk used to be the bottler for Pepsi and had quite a bit of capacity. Currently, Serm Suk’s utilisation is less than 30% (vs. 50% utilisation when previously operating for Pepsi) and successful traction will help bring up non-alcohol profitability. Management declined to define what the breakeven utilisation for CSD would be. Currently, Coke has a ~50% market  share, Pepsi >20% market share, and est cola has 12-13% market share.

CIMB estimates that 100Plus has captured 1-2% of the functional CSD market but the biggest hurdle to business growth remains adspending.

"It is still early days. Other than the effects of beer adspend, we expect non-alcohol beverage adspend to be relatively high through 2H15," said Ng.