Definitive Analysis
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China Foods Limited (0506.HK)

Company Dividend Discount ModelIndustry: Beverages - Non-AlcoholicSector: Consumer Defensive

Valuation Snapshot

Stable Growth$12.22 - $28.73$17.98
Multi-Stage$14.94 - $16.39$15.65
Blended Fair Value$16.81
Current Price$2.80
Upside500.46%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS33.89%0.00%0.150.120.110.090.040.030.060.860.020.00
YoY Growth--22.71%13.57%19.32%103.67%27.02%-42.59%-93.02%4,451.45%0.00%0.00%
Dividend Yield--6.30%4.39%4.30%3.59%2.04%1.28%2.39%23.53%0.64%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,670.35
(-) Cash Dividends Paid (M)751.35
(=) Cash Retained (M)919.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)334.07208.79125.28
Cash Retained (M)919.00919.00919.00
(-) Cash Required (M)-334.07-208.79-125.28
(=) Excess Retained (M)584.93710.20793.72
(/) Shares Outstanding (M)2,797.222,797.222,797.22
(=) Excess Retained per Share0.210.250.28
LTM Dividend per Share0.270.270.27
(+) Excess Retained per Share0.210.250.28
(=) Adjusted Dividend0.480.520.55
WACC / Discount Rate6.60%6.60%6.60%
Growth Rate2.59%3.59%4.59%
Fair Value$12.22$17.98$28.73
Upside / Downside336.38%541.99%925.97%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,670.351,730.311,792.431,856.781,923.441,992.492,052.27
Payout Ratio44.98%53.99%62.99%71.99%81.00%90.00%92.50%
Projected Dividends (M)751.35934.121,129.031,336.751,557.921,793.241,898.35

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.60%6.60%6.60%
Growth Rate2.59%3.59%4.59%
Year 1 PV (M)867.81876.27884.73
Year 2 PV (M)974.45993.541,012.81
Year 3 PV (M)1,071.831,103.481,135.75
Year 4 PV (M)1,160.501,206.421,253.68
Year 5 PV (M)1,240.991,302.661,366.76
PV of Terminal Value (M)36,481.4638,294.4940,178.89
Equity Value (M)41,797.0443,776.8545,832.62
Shares Outstanding (M)2,797.222,797.222,797.22
Fair Value$14.94$15.65$16.39
Upside / Downside433.65%458.93%485.18%

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