Sheng Siong shares continue last week’s slide, fall over 9% to hit one-year low
The company says competition in grocery retail could intensify over the coming year
Sheng Siong supermarket shares continued their recent decline, falling over 9% on Monday (Nov 2) morning to reach a one-year low. The company disclosed marginal growth in third-quarter net profit, but attributed the increase to a larger store network and improved sales. However, the supermarket operator warned that the grocery retail sector remains competitive and could face intensified competition due to upcoming developments like the Johor Bahru-Singapore RTS Link, which may lead to more cross-border shopping and heightened price competition.
Additionally, Sheng Siong cited rising labor costs, including wage increases under the Progressive Wage Model and the National Wages Council's guidelines, as challenges to its profitability. Analysts anticipate further moderation in the company's earnings growth in the fourth quarter.
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