Kasikorn Securities said ICHI reported normalized second-quarter 2026 profit of 309 million baht, down 1% year on year but up 8% quarter on quarter, below its previous estimate on weaker-than-expected revenue, even though cost impacts came in better than expected. ICHI targets 2026 sales of 9 billion baht, up 11% year on year, with gross margin and net margin of no less than 23.5% and 14.5% respectively, in line with our estimates. Its alkaline water continues to grow amid an overall softening market, with management saying demand still exceeds production capacity. Sales are expected at 1.1 to 1.2 billion baht in 2026 before growing about 40% to 1.6 billion baht in 2027. On production, ICHI installed an additional packaging line in June 2026 and signed a long-term contract with an external manufacturer to move production of roughly 300,000 to 400,000 crates of tea, which will add capacity for alkaline water, with results expected as early as the fourth quarter of 2026 to the first quarter of 2027. Meanwhile, the Cambodian market remains weak, cutting first-half 2026 export sales by 75% year on year, so the company is looking for opportunities in other markets, especially Malaysia, where ICHI's alkaline water is the first product of its kind registered with Malaysia's food and drug authority and is in a market trial period after the first shipment in March 2026. Kasikorn Securities maintains its Buy rating and mid-2027 target price of 16.10 baht, based on a target PER of 16 times, below the historical average of 17 times, and views a dividend yield of 7% to 8% as sustainable, since the company has passed the peak of its investment cycle and has strong free cash flow.
Ichitan Group Public Company LimitedKasikorn Securities maintains Buy rating and 16.10 baht target price after Q2/2026 normalized profit of 309 million baht, with sustainable 7-8% dividend yield.
