Broker: DBS Group Research
Date of Report: 30 July 2026
Excerpt from DBS Group Research report.
Report Summary
- Stock: Sheng Siong Group Ltd (SSG SP)
- Action: HOLD (maintained)
- Target Price: SGD 3.00 (raised from SGD 2.80)
- Key Highlights & Insights:
- Sheng Siong plans to invest SGD 520 million in a new state-of-the-art distribution centre, targeted for completion by end-2029. The centre will support at least 120 stores and is expected to improve gross margins and operational efficiency.
- FY26F earnings are maintained; FY27F earnings raised marginally by 0.5% due to stronger new store contributions and track record.
- Earnings growth is expected to moderate significantly in 2H26 and FY27, as the company laps a high base boosted by the SG60 voucher scheme, which contributed an estimated SGD 350 million to 2026 supermarket sales (approx. 4% of industry sales). The absence of this voucher will present a challenge for growth in 2027.
- 2026–2027 new store guidance: Four net new stores in FY26, five net new stores in FY27 (with potential closures due to HDB redevelopment).
- TP is based on a higher 28x forward PE (previously 26x), reflecting a premium for resilient, well-managed Singapore consumer names.
- Key risks include higher or lower than expected new store growth, staff costs, and scale benefits.
Key Actionable Insight:
- Investors should HOLD Sheng Siong at current levels with a revised price target of SGD 3.00, reflecting expectations for slower but stable earnings growth and the company’s strategic expansion plans.
Above is an excerpt from a report by DBS Group Research. Clients of DBS Group Research can access the full research report from the broker’s website.
