Dissecting the GSS disappointment

SINGAPORE (Aug 24): RHB Research is maintaining its “overweight” rating on the consumer sector but remains “negative” on discretionary retailers on weak consumer sentiment, the failure of the Great Singapore Sales (GSS) to excite shoppers, as well as the rising popularity of online shopping.

In a note on Wednesday, analyst Juliana Cai says she prefers stocks of F&B and grocery retailers. Cai has a “buy” rating for BreadTalk with a target price of $1.45, because of its continued product innovation. She also likes Dairy Farm International with a target price of US$8.60 and Sheng Siong with a target price of of $1.12.

Although the GSS sale this year had been extended to a 10-week event from eight weeks previously, Cai says the extended sale was unable to excite shoppers. She observed smaller crowds on the weekends compared to GSS last year, and scarce numbers of shoppers on weekdays.

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