- Sheng Siong (SGX:OV8)'s 1Q24 revenue and PATMI were within expectations at 26%/26% of our FY24e forecast. Same-store sales growth accelerated to 3.6% benefitting from the later lunar new year.
- Only one new HDB store was secured in 1Q24. The pipeline is healthy with three stores tenders submitted and another six to be tendered out. The lack of new stores will keep growth muted this year.
- - Read this at SGinvestors.io -
- With industry-leading margins, it will be challenging for Sheng Siong to expand further. Supply chain bottlenecks include distribution centres. Another avenue for growth is acquisitions, as Sheng Siong has built up a record net cash hoard of S$352 million.
The Positive
Acceleration in revenue & margins.
- - Read this at SGinvestors.io -
- Margins were supported by higher house brand sales, especially the successful rollout of frozen products.
The Negative
Only one new store was secured this year.
- Read more at SGinvestors.io.
