Super Group Declines on Profit Outlook: Singapore Mover

Super Group Ltd. (SUPER), Singapore’s largest instant coffee maker, slumped for a second day after reporting a slip in third-quarter earnings, posting its biggest two-day decline since the 1997 Asian financial crisis.

Super slid 14 percent to S$3.07 as of 11:11 a.m. in Singapore trading. The stock is heading for a 26 percent two-day drop, the most since Sept. 1, 1997. The shares are headed for fourth day of decline, longest losing streak since Oct. 8.

“More intense competition will likely sustain, and we have moderated our growth expectations,” Alfie Yeo, an analyst at DBS Vickers Securities, wrote in a note to clients yesterday. “Super’s first mover advantage in Myanmar is eroding now that other competitors such as Nestle are gaining traction in the frontier market. Other Asean markets such as Indonesia and the Philippines have also become more challenging.”

DBS Vickers said it lowered its rating for Super to hold from buy and cut its share-price forecast to S$3.97 from S$5.35 previously. The brokerage also cut its net profit forecast for the maker of Owl and Super Coffeemix brands by between 17 percent and 28 percent for the next three years after Super posted third-quarter earnings that missed estimates, Yeo said.

Super reported on Nov. 11 that third-quarter net income declined 17 percent to S$18.7 million from a year earlier as operating expenses increased.

The company said in July it’s seeking its first acquisition in a decade as it battles Nestle SA (NESN) for a bigger share of the market in Southeast Asia and China.

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net

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