Sheng Siong Group (SSG)

Innovation is key to staying relevant in brick & mortar, says CGS-CIMB

SINGAPORE (Oct 23): CGS-CIMB Research is maintaining “overweight” on the consumer staples sector after a recent visit to Habitat, honestbee’s tech-enabled grocery and dining destination in Pasir Panjang.

In a Tuesday report, analyst Cezzane See describes the online-to-offline (O2O) retail experience as “akin to shopping at an upmarket grocery store” – and says the move by honestbee proves that physical retail is still relevant despite the onset of the “new retail” phenomenon.

Supermarket, e-commerce plays draw investor interest: CGS-CIMB

SINGAPORE (Sept 14): CGS-CIMB Research is keeping its “overweight” rating on the consumer sector, amid optimism that a better-than-expected GDP growth rate in 2018 could spur retail consumption.

The brokerage hosted a Consumer Day on Sept 11, and says investors were largely positive on domestic supermarket plays and also expressed interest in learning about the key value propositions of the e-commerce companies.

Sheng Siong likely to see stellar FY19F as growth momentum continues: DBS

SINGAPORE (July 31): DBS Group Research is maintaining its “buy” call on Sheng Siong Group (SSG) with a higher target price of $1.26, implying 25 times FY19F earnings.

The valuation is pegged at +1 standard deviation (SD) point of SSG’s historical mean valuation since listing, and below regional peers’ average of 26 times earnings.

See: Sheng Siong posts 6.3% rise in 2Q earnings to $17.2 mil on higher sales

Supermarkets poised to be key beneficiaries of rising consumer sentiment

SINGAPORE (May 31): CGS-CIMB Securities is upgrading Singapore’s consumer staples sector to “overweight”, from “neutral” previously, on the back of expectations of improving retail sales.

Continuing from a 1.8% growth last year, Singapore’s retail sales index (RSI) excluding motor vehicles rose 2.6% in Mar 2018.

“The RSI typically tracks the GDP growth rate, and given our in-house GDP growth forecast of 3.2% in 2018F, we believe Singapore’s retail sales are on a better footing in 2018F,” says lead analyst Cezzane See in a report on Wednesday.

Can Dairy Farm's Cold Storage catch up to Sheng Siong as the sector's top pick?

SINGAPORE (May 21): RHB Research says low-cost supermarket chain Sheng Siong Group is its top pick among the consumer retail staples, amid recovering consumer sentiment on the back of improving job prospects and economic growth in Singapore.

“We have slight preference for Sheng Siong on its strong execution track record, high sales mix in fresh food, improving market share in Singapore and potential for gross margin expansion with the distribution centre extension coming up,” says analyst Juliana Cai in a report on Monday.

Sheng Siong downgraded by brokers after recent rally, but outlook remains positive

SINGAPORE (May 2): UOB and Phillip Capital are downgrading their calls on Sheng Siong Group from their previous “buy” calls to “hold” and “accumulate”, respectively, with target prices of $1.09 and $1.13 after the group’s recent stock price run-up  of around 10% over the last two months.

Meanwhile, OCBC and Maybank continues to rate Sheng Siong at “buy” with a fair value and price target of $1.12 and $1.20, respectively.

See: Steady start to FY18 keeps Sheng Siong firmly at 'buy'

This stock should be a long-term core holding of consumer portfolios: Maybank

SINGAPORE (Apr 3): Maybank Kim Eng is resuming coverage of Sheng Siong Group at “buy” with a price target of $1.20, or 25 times FY18 earnings and 7 times EV/EBITDA.

At Sheng Siong's Apr 2 opening price of 93 cents, the counter trades at 19 times FY18E EPS or one standard deviation below its five-year mean and a 41% discount to regional peers.

This comes after the counter’s 12-month underperformance of 10% against the Straits Times Index due to excessive concerns about e-commerce disruptions, in Maybank’s view.

Stocks to benefit from Budget 2018: UOB

SINGAPORE (Feb 20): UOB KayHian remains positive on property stocks and REITs saying the raising of BSD (Buyers Stamp Duty) rate is more of revenue collection than a property cooling measure.

See: Top marginal buyer's stamp duty for residential properties raised to 4%

Not all doom and gloom for Dairy Farm, Sheng Siong as Amazon muscles in

SINGAPORE (Aug 2): Amazon’s launch in Singapore will have little impact on the grocery retailers under its coverage — at least for now, says brokerage RHB.

Last week, Amazon launched its Prime Now express delivery service via its mobile app.

See: Amazon announces launch of Prime Now in Singapore

However, Singapore’s online grocery market share at present stands at a mere 1.2%.

Why Sheng Siong is likely to remain resilient amid keen competition

SINGAPORE (July 14): OCBC Investment Research continues to rate Sheng Siong Group (SSG) at “buy” with an unchanged fair value estimate of $1.15, pending the supermarket chain operator’s release of its 2Q17 results in the coming weeks.

In a Friday report, lead analyst Jodie Foo says that while Singapore’s May 2017 retail sales data “depicted a generally unexciting picture”, supermarket sales were stable with a 0.8% growth y-o-y.

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