OSK-DMG highlights consumer stocks

Excerpts from OSK-DMG report today

OSK-DMG highlights consumer stocks to fund managers

Analyst: Tan Han Meng, CFA, CPA

Sheng Siong's net profit grew 20.8% yoy to S$8.5 million in 2Q2013. Photo: Company

Scoop of the Day: We hosted 21 regional consumer companies from six countries/regions - Hong Kong, Indonesia, Malaysia, Philippines, Singapore and Thailand – at our inaugural RHB Consumer Day yesterday.

Responses from clients were overwhelming with packed meetings throughout the day. Key highlights from the locally-listed consumer stocks:
 

Eu Yan Sang (EYSAN SP, BUY, TP: SGD0.92) - ..."In view of the escalating rental costs, the group will focus on growing its wholesale business which contributed 14.6% of the FY13 revenue. Going forward, management expects this segment to grow by at least 25% per annum underpinned by acquisition of new wholesale customers."
 

Parkson Retail Asia (PRA SP, NEUTRAL; TP: SGD 1.28) - ..."PRA is bullish on its prospects in Indonesia, and is guiding for same store sales growth (SSSG) of 7%-9% in FY14. For Vietnam, PRA has guided for SSSG of 5%."
 

Sheng Siong (SSG SP, BUY, TP SGD0.78) - ..."The domestic grocery sector is highly competitive especially in the budget segment, which recently saw one of its competitors retreating from this space through a rebranding exercise."

 
Loquat juices and bottled fruits are the 2 business segments which are growing rapidly at Sino Grandness. Photo: Company 

Sino Grandness (SFGI SP, BUY, TP: SGD1.74) - ..."SFGI’s strategy is to be synonymous with the loquat fruit. Hence, it plans to continue to expand its loquat beverage products, It targets to introduce 1 to 2 new SKUs of Garden Fresh juice range per year.” 

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