Embotelladora Andina S.A (ANDINA-B.SN) fair value

ACCE thesis

Embotelladora Andina bottles and distributes Coca-Cola trademark beverages across Chile, Argentina and Brazil, and it also runs the Coca-Cola bottling franchise for Paraguay, with the Andina and Cachantun water brands and Powerade sold alongside the colas. Its moat is a regional bottling franchise that is costly to replicate, since distribution routes, cold-chain capacity and the exclusive bottler rights sit with a single operator in each territory. Revenue grew 11.1%, and a 39.5% gross margin with a 23.8% return on equity points to pricing power and efficient use of capital, though the 10.5% operating margin leaves less room for error than the gross line suggests. The trailing P/E of 16.9 sits well below the forward P/E of 32.0, which means the market is pricing a sharp drop in earnings that the reported numbers have not yet shown, so the first question for the team is whether that gap reflects a one-off charge, a currency effect or a real deterioration in the next year. Given that the name is outside the major indices and carries a score of 67/100, it merits a deeper look focused on that earnings gap and on how much of the 11.1% growth came from volume versus price.