Sheng Siong Group - OCBC Investment 2016-04-28: Signed a lease for first store in China

Sheng Siong Group - OCBC Investment 2016-04-28: Signed a lease for first store in China SHENG SIONG GROUP LTD OV8.SI 

Sheng Siong Group: Signed a lease for first store in China 

  • Sheng Siong Group’s (SSG) 1Q16 results came in within our expectations. 
  • Revenue increased 5.1% YoY to S$208.5m and net profit grew 16.8% to S$16.4m, meeting 26% and 31% of our full year estimates. 
  • As the group recorded a relatively higher amount of government grants at S$2.3m this quarter, stripping out ‘other income’, results remain well within expectations. 
  • Revenue was driven by new store growth of 5.6%, but saw a slight 0.5% contraction in comparable same store sales growth due to slower Chinese New Year and other factors cited in the previous quarter. 
  • Separately, the subsidiary in Kunming China has signed a lease for their first supermarket at an approximate size of 54k sq ft, and is slated to open in 4Q16. 
  • Pending more information from the analyst briefing later, we maintain BUY with fair value estimate of S$0.95.



Jodie Foo OCBC Securities | http://www.ocbcresearch.com/ 2016-04-28
OCBC Securities SGX Stock Analyst Report BUY Maintain BUY 0.95 Same 0.95


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