F&N may raise prices by up to 4pct

Fraser & Neave Holdings Bhd (F&N) anticipates raising prices by up to 4 percent on select items as it faces surging commodity costs while striving to keep prices affordable for consumers, according to its chief executive officer Tarang Gupta. The company has already implemented price hikes across its product range in Malaysia and Thailand over the past 12 to 15 months.

Gupta noted that if commodity prices continue to rise, additional adjustments may be necessary, but the firm would remain sensitive to consumer affordability and demand. Price increases might influence consumer purchasing decisions, but F&N aims to maintain sales volumes and cater to its customer base. The company is focusing on operational efficiencies and analyzing consumer consumption patterns to determine the most effective strategy.

Commodity prices, including sugar, tin, and energy, have been on the rise, posing challenges for the food and beverage sector. However, Gupta stated that F&N would prioritize operational efficiencies before contemplating further price increases. The availability of raw materials has stabilized despite tensions in the Middle East, but sourcing them at favorable prices remains a challenge.

F&N expects to require an additional six months to evaluate the performance of its operations in Cambodia following the launch of its new factory. Initial trade acceptance has been encouraging, but the firm needs more time to ascertain the operation's full potential. F&N plans to concentrate on expanding its business pipeline and increasing its presence in the Cambodian market during FY27.

The company's transformation from a trading to a manufacturing model has resulted in higher initial operating costs, which will necessitate time to achieve greater scale. However, Gupta suggested that the group does not anticipate significant additional investments in Cambodia after the factory's completion.