Singapore F&B Sector - CGS-CIMB Research 2023-03-20: Continued Recovery In Restaurants

Singapore F&B Sector - Continued Recovery In Restaurants

  • According to latest Singstat data,
    • Total F&B sales in Singapore (seasonally adjusted) rose 20% y-o-y in Jan 23, driven by recovery in both restaurant (+19% y-o-y) and café & food court (+13% y-o-y) sales. Restaurant sales recovery in 4Q22 was likely due to post-COVID recovery in recreational and corporate dine-in activities, and increasing tourist arrivals. Similarly, café & food court sales recorded healthy growth through 4Q22, albeit at a slower pace compared to restaurants as such outlets were far less affected by dine-in restrictions.
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We reiterate our ADD call on Jumbo Group (SGX:42R)

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  • We forecast a net profit of S$8.6m for Jumbo in FY23F (vs. FY22: S$0.1m net loss), driven by:
    1. Healthy restaurant spending as corporate meals ramp-up (pre-COVID, corporate meals formed about 1/3 of Jumbo’s customer mix).
    2. Return of North Asian tourists to Singapore (similar to corporate meals, tourists formed about 1/3 of Jumbo’s customer mix during pre-COVID times).
    3. Easing of domestic pandemic measures in China (pre-COVID, China outlets typically contributed ~20% of Jumbo's revenue). Resumption of domestic travel could drive up revenue contribution from the Universal Beijing Resort outlet; the outlet only commenced operations in Sep 21 and was thereafter adversely impacted by sporadic lockdowns implemented in FY22.
  • Our target price of S$0.35 for Jumbo is based on 20.0x CY24F P/E, 1.5 standard deviation below its 3-year historical mean.

We maintain our HOLD call on Kimly Group (SGX:1D0)

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Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @

Kenneth TAN CGS-CIMB Research | ONG Khang Chuen CFA CGS-CIMB Research | 2023-03-20

More views on outlook of consumer sector:
Analyst Reports on Singapore Consumer Sector


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