Consumer sector - OCBC Investment 2016-08-25: No sign of pick up from key data

Consumer sector - OCBC Investment 2016-08-25: No sign of pick up from key data SHENG SIONG GROUP LTD OV8.SI

Consumer sector - No sign of pick up from key data

  • According to key data released this month that were relevant to Singapore's consumer sector, this included Singapore's Jun retail sales data.
  • Excluding motor vehicles, Jun retail sales were down 3% YoY. Department stores, supermarkets, F&B were among the sub-sectors that recorded a lower sales performance YoY. 
  • In addition, Nielsen data showed that Singapore's consumer confidence level for 2Q16 remained at 88 points, same as 1Q16, whereby a number below 100 indicates pessimism. Their findings further reveal that consumers have also reduced certain discretionary expenditures, and some may switch to cheaper grocery brands. 
  • Such sentiment is largely reflected by recent findings from another survey, MasterCard Index of Consumer Confidence
  • Given the subdued outlook for the local macro environment, we maintain NEUTRAL on the consumer sector
  • On our top pick Sheng Siong Group [BUY, S$1.07], we note that the share price rose 6% in the past three trading days, even touching an intraday high of S$1.155 yesterday. Investors can consider taking some profits at current share price levels.

Jodie Foo OCBC Investment | http://www.ocbcresearch.com/ 2016-08-25
OCBC Investment SGX Stock Analyst Report BUY Maintain BUY 1.07 Same 1.07