Sheng Siong Group (SSG) has completed the S$65m acquisition of a property at Block 506 Tampines Central 1 and a new supermarket (~9.8k sq ft) is expected to open on the second floor by the end of Jan 2015. Some upside could be seen, as the store would likely enjoy higher sales during the Chinese New Year festive season. The Tampines store may also be expanded following the expiry of existing tenancies in 2016 and 2017. SSG has since utilized 85% of the ~S$80.4m raised from last year's placement while it still holds significant cash balance for further growth. On a separate note, SSG recently announced a proposed conditional JV with the Kunming Luchen Group. There were no changes made to the conditions from the initial announcement in Aug 2014. We view this as a step towards establishing a stronger and supportive relationship, but the group's regional expansion plans are still at the early stages. Maintain BUY with an unchanged fair value estimate of S$0.77.

Source: OCBC Research - 2 Jan 2015