| To everyday folk in Singapore, Budget 2025 so clearly means they have more spending power with SG60 and CDC vouchers. To stock investors, a key sector to consider is grocery chains and retail malls. Supermarkets like Sheng Siong and retail REITs like Frasers Centrepoint Trust are set to get a boost. Let's take a look at four analyst reports -- DBS, UOB Kay Hian, OCBC and CIMB. Here's a summary of the key points: Grocery Chains Analysts estimate that these measures will significantly boost grocery sales volumes, with up to SGD1.7 billion in vouchers potentially directed toward grocery spending. |
| ALTERNATIVE PAYMENT METHOD "Half of the vouchers can be used at participating supermarket operators such as Sheng Siong (SSG SP/BUY/Target: S$1.93) which has a more pronounced presence in the mass market areas compared to DFI Retail Group (DFI SP/BUY/Target: S$2.57). The other half of the vouchers can be used at heartland merchants and hawkers, including coffeeshop operators like Kimly (KMLY SP/HOLD/Fair value: S$0.34). We do not expect significant revenue growth as they essentially function as an alternative payment method to cash for groceries and essential items." -- UOB KAYHIAN |
Specific measures in the Singapore Budget 2025 that are expected to benefit grocery chains and retail malls include:
For Grocery Chains
SG60 Vouchers:
Each Singaporean aged 21 and above will receive SG$600-800 in SG60 vouchers, which can be used at participating supermarkets, hawkers, and merchants.
Community Development Council (CDC) Vouchers:
Households will receive SG$800 in CDC vouchers, disbursed in two tranches. These vouchers are partially earmarked for use at supermarkets.
LifeSG Credits:
Families with children under 12 will receive SG$500 in LifeSG credits, which can be spent on groceries and other essentials.
U-Save Rebates:
Eligible households will get up to SG$760 in utility rebates, freeing up disposable income for grocery spending.
Enhanced Disposable Income:
Additional measures such as income tax rebates (60%, capped at SG$200) and wage support programs are expected to increase household spending power, indirectly benefiting grocery retailers like Sheng Siong and DFI Retail.
