SINGAPORE (Mar 15): Jumbo is planning to anchor growth in the domestic market through new outlet openings and new F&B concepts while riding on brand equity to expand overseas footprints.
Meanwhile, UOB KayHian says it will keep its 2019-21 earnings forecasts unchanged as it awaits announcements of any conclusion of new franchises or outlet openings.
“Maintain ‘hold’ with a PE-based target price of 41 cents, pegged to peers’ average 20x 2019F earnings. Entry price is 37 cents,” says analyst Yeo Hai Wei in a Thursday report.
Jumbo is planning to open more outlets in Singapore to drive growth in Singapore operations. In the next six months, the F&B group intends to open one Jumbo Seafood restaurant, one Teochew Cuisine outlet and two Tsui Wah Cha Chaan Teng outlets in Singapore.
In addition, Jumbo also cited the potential opening of one new outlet in Shanghai and up to two new outlets in Beijing. Management is also exploring JVs and franchises in other Chinese cities such as Shenzhen and Xiamen.
In South Korea, Jumbo has entered into a JV with TCI Inc, a subsidiary of Didim Inc, to launch Jumbo Seafood. The first Jumbo Seafood restaurant is targeted to be operational in Seoul by Sep 19.
In addition to new outlet openings in Singapore and overseas markets, management also remains open to M&A opportunities which can enhance Jumbo’s current brand mix or are complementary to its current business.
As at 12.50pm, shares in Jumbo are up 0.5 cent at 40 cents.
