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Eating home more is the new normal. Frozen food - a Covid-19 beneficiary

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Publish date: Mon, 01 Jun 2020, 04:29 PM
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Covid-19 has changed consumers’ habits as more of them decide to eat at home. And according to a study conducted by Nielsen, the trend will continue once the pandemic passes, potentially reshaping the food service and grocery industries. Eating at home will remain the new reality for consumers post COVID-19.
 
 
Since Covid-19, frozen food demand has spiked globally: US 78.8% Italy 45.1%; France 41.6%; UK 32.8%; NZ 19.3%
 
 
 
Kawan food, being one of the largest frozen food producer in Malaysia, is an obvious winner from this trend. In their latest QR, Kawan Food reported a surge of 319% in their profit.
 
 
 
 
The management is very confident that Kawan food will benefit from Covid-19. Page 8 of the QR:
"the new norm is to eat more at home. Since there are more people working from home, our convenient food remains high in demand as we provide a fast solution for the need of a fair & square meal. Additionally, eating at home is more economical than take away or food delivery. Therefore, sales to retailers and E-commerce platforms will continue to see a strong positive trend."
 
Deep value investing valuation: RM4.84
 
Kindly exercise your own due diligence. This is not a recommendation to buy or sell shares.
 
 
 
KAWAN (7216)
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Kawan Food Valuation - RM4.84

Created by deepvalueinvesting | Jun 05, 2020

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