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2 Food Businesses Growing Rapidly

Royston Yang

Living in a nation with many different cuisines, Singaporeans are blessed with a buffet of choices when it comes to deciding what to eat. The same can also be said for the stock market as it serves up a platter of juicy companies belonging to the food and beverage (F&B) industry.

However, not all F&B businesses enjoy the same fervent following. Over time, some may lose their allure, while others go from strength to strength to conquer other countries and regions. Brand-building is as much an art as a science, and some companies have managed to generate the right kind and amount of buzz to ensure their continued longevity.

Here are two F&B businesses that are growing rapidly, and I believe both also have strong brands that are recognised in many Asian countries besides Singapore.

1. Jumbo Group Limited

Jumbo Group Limited (SGX: 42R) is one of Singapore’s leading multidining F&B establishments, and the group is famous for its signature chili crab dish. Jumbo has a total of 13 F&B outlets in Singapore and six in China, under five restaurant brands. The group also has F&B outlets under licensing arrangements in cities such as Taipei, Bangkok, and Tokyo.

The group has been aggressively expanding this year, with a new outlet under the main Jumbo Seafood brand opening at Jewel Changi Airport in April 2019. In addition, two new Teochew dining concepts were also introduced with the opening of Zui Yu Xuan Teochew Cuisine and Chao Ting at Far East Square.

Jumbo has also accelerated its regional expansion with the opening of its second, third, and fourth Ng Ah Sio outlets in Taiwan in April, June, and October 2019. Jumbo Seafood has also opened its first two outlets in South Korea this year, while a second Tsui Wah outlet recently opened in Singapore. It seems the group is bent on rolling out many food concepts in many different countries this year, and investors can look forward to good top-line growth.

2. BreadTalk Group Limited

BreadTalk Group Limited (SGX: CTN) started off as a bakery brand back in 2000 and rapidly expanded to become a diversified F&B group with its restaurant and food court segments. The group has close to 1,000 retail stores spread across 16 countries, and its brand portfolio consists of recognisable names such as Toast Box, Food Republic, and Bread Society.

The group has partnerships with brands such as Song Fa Bak Kut Teh as well as Wu Pao Chun. The former is an established brand with eight outlets in Singapore and seven in Indonesia, while the latter is an artisanal bakery with three flagship stores in Taiwan. BreadTalk and Song Fa have worked together to open Song Fa’s first restaurant in Beijing, China, on January 2019. Four months later, Song Fa expanded its reach to the Taiwan market. In June 2019, BreadTalk brought over the Wu Pao Chun brand to Singapore, opening its first outlet at Capitol near City Hall.

In September, BreadTalk announced the acquisition of the Food Junction chain of food courts from Auric Pacific for S$80 million. Food Junction operates 12 food courts in Singapore and three in Malaysia, and the acquisition will strengthen BreadTalk’s hold on the food court sector in Singapore. The acquisition has been given the green light by the authorities and should boost BreadTalk’s revenue numbers in the next quarter.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Royston Yang doesn’t own shares in any companies mentioned.

Motley Fool Singapore 2019