Fundamental Analysis and Valuation of Carlsberg A/S with a Focus on the Markets East Europa and Asias Effect on the Value.

Astrid Marie Wengler

Student thesis: Master thesis


The main objective of this master thesis is to determine a fair value of Carlsberg Group A/S (Carlsberg in the following) equity and hence a fair value of Carlsberg’s stock. Furthermore, the thesis tries to explain how the growing markets of Asia and Eastern Europe will affect Carlsberg’s fair value. Carlsberg is a Danish based beer company and is placed as the third beer company in the world and listed on Copenhagen stock exchange. Their products are sold in more than 150 countries and have a broad portfolio of different product. In order to estimate a fair value of Carlsberg’s stock, the analysis is split into a strategic and financial analysis. Based on assumptions derived from these two analyses, the stock value at 22nd of August 2018 has been calculated. The strategic analysis is split into an analysis at a macro-, meso- and micro level. It shows that Carlsberg are facing great competition in the industry and are competing on the share of market with the two biggest beercompanies in the world. Furthermore, Carlsberg has delivered solid cost-cutting through their program Funding The Journey. Models such as PESTEL, Porters 5 Forces, Porters Value Chain and Ansoff’s Matrix of Growth is used to carry out the analysis. Furthermore, the thesis analysis Carlsberg’s historic financial performance, in which the future predictions is based on. The fair value is estimated through a Discounted Cash Flow model (DCF). The DCF-model is based on a fundamental analyses of the company’s strategic and financial side. The analysis shows that Carlsberg is facing both challenges from competition from other breweries and different preferences from consumers. The financial analysis tries to eliminate how the different emerging markets are affecting the value of Carlsberg. Here it is concluded that the two respective markets, Asia and East-Europa, has an important impact on the value of Carlsberg. Asia is predicted to deliver 30 pct. of the groups EBIT which will be substantially higher than Eastern Europe, that are predicted to deliver 20 pct. of the group’s EBIT. A sensitivity analysis is made to ensure the quality of the valuation, since it is based on several different assumptions, regarding the estimated variables in the model. The result was, that the different incremental changes do not alter the calculated price significantly. The estimated fair value of Carlsberg in the analysis on the 22th august 2018 was 692 DKK. The observed share price on the marked on the same day was 797 DKK. Thus, the thesis suggests that the estimated valuation on the market was overstated.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
Publication date2019
Number of pages90