Sheng Siong currently has around 18% market share of the supermarket revenue in Singapore. Though it might be relatively small but as a slow and steady competitor of NTUC (Private) and Dairy Farm (Public), it has achieved sustainable and steady growth.
24 weeks outlook (Weekly Chart)
Author’s sentiments
Fairly simple analysis for Sheng Siong, defensive nature however subjected to market surges every now and then due to a few reasons
- Company mostly own by its own holdings (Sheng Siong Holdings Pte Ltd)
- Substantial ownership by founder family members
- Almost periodic purchases (large quantities) made by Lim family
- Expansion plans are slow and steady (Net positive Cash Flow)
- Possibility of De-listing in the future (personal view)
Author’s Call
- Buy in at $1.10-$1.13 (higher volumes) or $1.08 (conservative)
- likely to return to $1.22 territory after another quarter of good results
- Look out for announcements on expansion of new stores
- Festive Seasons rush (above or below expectations) – trigger market interests accordingly
- Defensive in nature of business with decent dividends of around $0.034 per year
- Expansion in China still at its infancy, looking out for next quarter results
