(Bloomberg) — Lim Hock Chee and his wife used to sell chilled pork at a rented stall in a grocery store.
Now, after more than 35 years, his family operates 61 supermarkets across Singapore and has joined the ranks of billionaires.
Shares of their Sheng Siong Group Ltd., which competes with Amazon.com Inc. in the city-state, rose to a record Wednesday as supermarkets have become the preferred place to shop after the government imposed a partial lockdown to contain the coronavirus pandemic. The stock has rallied more than 30% since a March 19 closing low.
The family’s combined fortune, based on their 57% stake in the retailer held mainly by Lim and his two brothers, has surged to $1.1 billion, according to the Bloomberg Billionaires Index. That would have been inconceivable when Lim started the pork stall to help alleviate a supply glut at his father’s pig farm. The brothers took over the supermarket where the stall was located and turned it into the first Sheng Siong store in 1985, and today is planning a foray into Singapore’s digital banking scene.
The founders declined to comment on their wealth, according to a Sheng Siong spokesman. The brothers and their family were thrust into the media spotlight in 2014, when their mother was kidnapped. She was released unharmed after Lim paid ransom, and the kidnapper was sentenced to life imprisonment.
Regulatory filings show that Lim bought more shares last month through an account jointly held with his wife. He may have learned a thing or two from previous outbreaks.
“When people stayed away from restaurants during SARS, we enjoyed brisk business because more people started buying food to cook at home,” he said in a 2008 interview with the Straits Times.
Grocery purchases are likely to remain robust even if social-distancing restrictions and panic-buying abates, according to Juliana Cai, an analyst at RHB Securities Singapore Pte.
“Employees are likely to be encouraged to continue working from home to prevent another wave of the viral contagion,” she wrote, maintaining Sheng Siong as her top pick among consumer-focused stocks.
Sheng Siong’s shares rose 4.4% Thursday, the most in nearly three weeks, bringing year-to-date gains to nearly 14%. Daiwa Capital Markets Singapore Ltd. raised the stock’s target price to S$1.48 from S$1.37, maintaining an outperform rating.
The Lims aren’t the only ones benefiting from a surge in grocery spending.
Amazon.com Inc., which owns Whole Foods Markets, surged to another record Wednesday, lifting the fortune of founder Jeff Bezos to $139.8 billion. Alice, Jim and Rob Walton, members of the world’s richest family, now have a combined net worth of $168.5 billion as shares of their Walmart Inc. climbed 8.4% this year.
Radhakishan Damani, who controls Avenue Supermarts Ltd. in India, now has a net worth of $10.7 billion, an increase of about 10% since the start of the year.
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DBS Bank Ltd. analysts said they expect Sheng Siong to boost earnings over the next two years, citing social-distancing and stimulus measures, as well as cost cuts. The company posted 2019 net income of S$75.8 million ($53.1 million) on revenue of S$991.3 million.
“Sheng Siong’s target customers are not so much of millennials who are open to online grocery shopping,” DBS’s Alfie Yeo and Andy Sim wrote in a note to clients Wednesday.
The grocer, with its “decent” store network and logistics chain, eventually could be a takeover target for online players, the analysts wrote.
The brothers are already considering branching out from its core business. Sheng Siong Holdings, a private entity owned by the Lims, is part of a consortium led by local gaming company Razer Inc. that has applied for a digital-banking license.
In an interview last year with tax and consulting firm RSM Singapore, Lim Hock Chee said people should embrace change because “the world never stops turning.”
(Updates with Thursday’s share price gains in 10th paragraph.)
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