Life Water Expands Consumer Staples With Sabah Acquisition

Life Water will acquire three Sabah food companies for RM46.8 million, expanding into consumer staples, strengthening earnings prospects, and supporting a higher RM1.72 target price outlook.

Life Water Broadens Consumer Staples

Life Water Bhd has agreed to acquire a 90% equity interest in three Sabah-based food companies for RM46.8 million, marking a strategic move to expand beyond its core bottled water business into the broader consumer staples segment.

The acquisition covers Hung On Thong Mini Supermarket Sdn Bhd, Hung Tai Enterprise (Sabah) Sdn Bhd and Kilang Mee Ban Soon Sdn Bhd. The deal is backed by a two-year profit guarantee of RM7.5 million annually, broadly matching the businesses’ combined FY25 net profit of RM7.6 million, implying an attractive valuation of about 6.8 times FY25 earnings.

The transaction is expected to be completed within three months and is projected to enhance Life Water’s earnings immediately. Analysts have raised FY27 and FY28 earnings forecasts by 7% to 12% and maintained an “Outperform” rating, while increasing the target price to RM1.72 on stronger earnings visibility and improved business diversification prospects.