CCL – Credit Suisse rates the stock as Neutral

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Victoria’s parliament has released a final report on the recycling and waste management inquiry. A recommendation to include a container deposit scheme was included.

Credit Suisse recalls that the NSW scheme affected Coca-Cola Amatil volume by -3.4% in 2018 and Queensland’s scheme also reduced volume by -3.8% in the first half of FY19.

Western Australia is targeting a scheme by June 2020. The broker notes the company has used pricing from time to time to protect soft drink volumes as the schemes were implemented.

There is also a proposal before the NZ government. Credit Suisse retains a Neutral rating and $11 target.

Sector: Food, Beverage & Tobacco.

Target price is $11.00.Current Price is $11.46. Difference: ($0.46) – (brackets indicate current price is over target). If CCL meets the Credit Suisse target it will return approximately -4% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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