Rami Levi Set for Record High as FMR Buys Shares: Tel Aviv Mover

Rami Levi Chain Stores Hashikma Marketing 2006 Ltd. (RMLI) headed for the highest level on record as FMR LLC increased its stake in the operator of discount supermarkets to 5.3 percent.

The shares advanced 1.2 percent to 169.5 shekels at 1:50 p.m. in Tel Aviv, set for the highest close since the shares were listed in June 2007. The benchmark TA-25 Index dropped less than 0.1 percent to 1,229.57.

The company said in a filing today that the Boston, Massachusetts-based investment manager raised its stake on April 11, buying 12,000 shares at a price of 168.16 shekels ($46.40). On March 28, Rami Levi said MSD European Opportunity Fund LP, part of MSD Capital LP, acquired shares in the company, bringing its stake to 6.18 percent.

“Rami Levi is an interesting success story,” Meir Slater, an analyst at Tel Aviv-based DS Securities & Investments Ltd., said today by phone. “Foreign funds are buying the shares because they see solid growth over the years and the rise in revenue is expected to continue as the company opens new branches.”

The shares of Rami Levi, which has won customers with bargains such as a kilogram (2.2 pounds) of chicken for 1 shekel (26 cents), have gained 33 percent in the last 12 months. The country’s second-biggest grocer by market value posted revenues of 2.79 billion shekels in 2012, up almost 26 percent from 2011. Profit for 2012 rose 17 percent to 110.4 million shekels.

Slater forecasts Rami Levi will post revenue of 3.15 billion shekels in 2013, while Gil Dattner, an analyst at Bank Leumi Le-Israel (LUMI) Ltd. expects revenue to rise to 3.57 billion shekels from 2.8 billion shekels in 2012, according to data compiled by Bloomberg.

The company, which has 26 branches across the country, plans to increase the number of stores to 50 by the end of 2015, according to an investor presentation released to the bourse on March 19.

To contact the reporter on this story: Shoshanna Solomon in Tel Aviv at ssolomon22@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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