Jumbo Group - Bumpy Path To Recovery
- Jumbo Group (SGX:42R)'s 1HFY22 (Oct 2021 to Mar 2022) net loss of S$4.5m was below our expectations due to Omicron impacts. Significant easing of COVID measures in Singapore will aid recovery.
- However, key overhang is strict COVID-19 restrictions in China (7 outlets). We now expect Jumbo Group to remain loss-making in FY22F (S$5m net loss).
- We believe Jumbo Group’s 2HFY22 China revenue will be impacted by ongoing COVID- restrictions imposed in Shanghai and Beijing (Jumbo operates seven outlets across the two cities). While Shanghai is aiming to end its lockdown by Jun 2022, we think domestic spending could take time to recover.
- Reiterate HOLD call on Jumbo Group with lower target price of S$0.30, still based on 20.5x CY23F P/E.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
Kenneth TAN CGS-CIMB Research | ONG Khang Chuen CFA CGS-CIMB Research | https://www.cgs-cimb.com 2022-05-17 2022-05-17
Read also CGS-CIMB's most recent report:
2022-12-13 Jumbo Group - Clawed Out Of The Red.