Retail stocks (Trade) get positives from a busy shopping environment. and tourism which tends to continue to recover Reflected by government indicators. Be it the Consumer Confidence Index (CCI), the Retail Group Confidence Index. and the Farm Price Index in a positive direction
According to data from the Office of Trade Policy and Strategy (OTP), the general consumer price index (CPI) for November 2022 was at 5.55% of the previous year. And this is considered better than the market expectation of 5.8 – 5.9% because it is an increase at a slower rate for 3 consecutive months. This was a result of a reduction in the price of fresh food, vegetables and fruit, as well as the price of meat such as eggs, chicken and pork from more output to the market. The flood situation has eased.
The average CPI for the 11-month period this year (January-November) was 6.1%, so the end-2022 CPI is expected to remain within the government’s range of 5.5-6.5%, which is an increase in the rate of decline.
Cause the pressure of the burden of higher costs to begin to have a direction to relieve itself
As well as inflation, numbers are increasing at a declining rate This is a good sign for the cost of doing business. There are also indicators that it will support future purchasing power as follows:
1. Consumer Confidence Index (CCI) with continued recovery numbers Part of it comes from the spread of COVID-19 has subsided and everyday life is more normal.
2. The Retail Entrepreneurs Sentiment Index (RSI) was supported by the economic recovery. with activities from tourism to support Greater confidence in single shop sales (SSSG) and frequency of service
3. Increase in the Farm Income Index in line with the agricultural price index This was partly due to supporting the increase in the cost of production price. It is expected that farmers will continue to play an important role in increasing purchasing power.
analyst Yuanta Securities (Thailand) estimates that such positive factors will benefit The retail sector’s average same-store sales (SSSG) in Q4/2022 continued to increase. Compared to the third quarter of 2022 at + 15% of the previous year, the figures gathered from operators showed that the average SSSG (October – November) of the group was positive at 5 – 7% of the previous year, reflecting that the buy stayed the power, grow well
Companies that can perform SSSG well and above the group average are CPALL or CP All Public Company Limited +12 – 15%, MAKRO or Siam Makro Public Company Limited +7 – 9% and CRC or Central Retail. 9% as a result of purchasing power in the consumer goods group which has improved from normal activities. and entering the high season
thus giving pressure to invest in retail stocks “more than the market” Expect Q4/2022 to be a good quarter of New Year activities and entering the tourism season Including the return of foreign tourists, resulting in continued positive SSSG, while in 2023, group performance growth is expected to increase initially the year. with the opportunity to benefit from government measures, for example, we travel together and shop well and have a night out
Willing to recommend 2 Top Pick stocks in the retail sector, selected from the SSSG in Q4/2022, which will outperform the group average. and has a turnover growth rate in 2023 greater than the group, viz
CPALL stock Or CP All Public Company Limited recommends “buy”, target price 75 baht per share, expects normal profit in 2023 at 17,000 million baht, growing 38%.
Stock MACRO Or Siam Makro Public Company Limited recommends “buy”, target price 48 baht per share, normal profit in 2023 is expected to be 13,000 million baht, growing 60%.
consider a group with full supporting factors This made the investment atmosphere start to become bright again, however, anyone interested in retail stocks There are still risk factors to consider and be careful with. That’s the number of people infected with COVID-19. which has the opportunity to grow rapidly, including the still high cost burden which is putting pressure on profitability
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