Buy recommendation maintained
June 24, 2026/CSL Update
UAC of Nigeria Plc (UACN) delivered a strong Q1 2026 performance, with Revenue surging by 241.5% year-on-year (y/y) to ₦191.2 billion, compared with ₦56.0 billion in Q1 2025. The impressive growth was primarily driven by the consolidation of CHI Limited’s operations, which led to robust sales growth in the Packaged Food & Beverages segment. The acquisition significantly transformed the Group’s revenue mix, with the Packaged Food & Beverages segment recording a 738.8% y/y increase and accounting for 84.2% of total Revenue, up from 34.3% in the corresponding period of 2025.
Supported by strong topline expansion and sustained cost efficiency, Operating Profit increased by 315.8% y/y to ₦28.4 billion (Q1 2025: ₦6.8 billion). Similarly, Profit After Tax (PAT) rose by 311.4% y/y to ₦13.6 billion from ₦3.3 billion in Q1 2025. Looking ahead, the full-year impact of the CHI acquisition is expected to notably enhance UACN’s earnings profile in FY 2026. We forecast Revenue to reach ₦853.0 billion, representing a 150.5% y/y increase from ₦340.5 billion in FY 2025. We also expect the Group to maintain the cost discipline demonstrated in Q1 2026, with Operating Profit and Profit Before Tax projected at ₦93.1 billion and ₦75.1 billion, respectively, compared with ₦28.5 billion and ₦16.4 billion in FY 2025.
UACN currently trades at an EV/EBITDA multiple of 13.05x, above the Middle East and Africa (MEA) peer average of 10.55x. Despite the premium valuation, we maintain our BUY recommendation and revise our target price upward to ₦268.33 per share from ₦103.44 per share. The revised valuation reflects the Group’s enhanced earnings capacity, stronger market positioning, and expectations of sustained operating and cost efficiencies following the CHI acquisition.
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