Sheng Siong

Sheng Siong: Looking ahead, 4Q14 will see contribution from Sheng Siong Group’s new ~4.0k sq ft store in the Penjuru area that recently started operations. The acquisition of Block 506 Tampines Central 1 will also likely follow through despite a delay. OCBC believes some upside could be seen if management succeeds in opening this store (~9.8k sq ft) before the next Chinese New Year to reap the benefits of higher sales during the festive season. Store expansion within the next two years will play a significant role to ensure the closure of its ~42k sq ft Woodlands store in 2017 will not adversely affect financial performance. At this juncture, OCBC expects steady growth albeit at moderated levels and maintains BUY rating with TP of $0.77.