Shoprite Feels the SA Consumer Price Shifts, JSE: SHP Shares at Crossroads
Shoprite Holdings has seen its share price rebound this week, reflecting investor optimism despite ongoing retail headwinds and price-sensit
Quick overview
- Shoprite Holdings' share price has rebounded nearly 1% this week, reflecting investor optimism amid retail challenges.
- The company reported a 10.4% increase in overall sales for the quarter ending September 2023, with a strong performance in its South African supermarket segment.
- Shoprite continues to expand aggressively, opening 68 new stores in the first quarter to strengthen its market position against local competitors.
- Despite ongoing consumer price sensitivity, Shoprite's revenue grew to $13.34 billion in 2024, showcasing its operational resilience.
Shoprite Holdings has seen its share price rebound this week, reflecting investor optimism despite ongoing retail headwinds and price-sensitive consumer shifts.
Shoprite Share Price Moves Higher on the JSE
Shoprite Holdings’ share price rose nearly 1% yesterday on the JSE, recovering to its opening level for the week. The SHPJ stock has been on a strong long-term uptrend since 2020, when it briefly fell below R100 before climbing more than 300% to a late-2024 peak above R31.30.
Q1 2025 Correction and Technical Support – Weekly Chart
In the first quarter of 2025, however, Shoprite’s share price declined sharply to around R23.50—approximately 24% lower. The 200-week simple moving average (SMA) on the weekly chart provided robust support, triggering a strong rebound.
Yet, the recovery faltered at the 50-week SMA amid signs of boycotts and customer frustration over soaring food prices in 2025. Many South African consumers are shifting to smaller, local stores with cheaper prices, pressuring large retailers.
JSE: SHP Chart Monthly – Facing the 2018 High
Sales Growth Across Divisions
During the quarter ending September 2023, overall sales rose by 10.4% compared to the same period in the previous year, signaling ongoing demand strength in core markets.
For the fiscal year ending June 2024, Shoprite’s core South African supermarket segment reported a 12% increase in sales, reaching R240.7 billion. This performance stands out when compared with its main competitor, Pick n Pay, which announced a more modest 3.7% turnover increase in the 26 weeks leading up to August 2024.
Store Expansion Strategy
Shoprite continues to expand aggressively to strengthen its market position. In the first quarter alone, the company opened 68 new stores, including 53 in the critical South African grocery market. This expansion aligns with its ecosystem strategy, aimed at creating a comprehensive retail offering and defending market share against nimble local competitors.
Supermarkets RSA Performance Highlights
- Sales growth of 10.4% in the Supermarkets RSA segment.
- Comparable store sales climbed 6.1% during the 26 weeks ended 29 December 2024.
- Customer visits rose by 4.1%, indicating improved shopper traffic.
- Average transaction value increased by 6.1%, showing stronger basket sizes.
Improved Profit Margins and Sales Mix
- Gross profit margin advanced slightly to 23.9% from 23.6% last year.
Growth drivers included:
- Better supply chain efficiencies.
- Sustained volume increases.
- Effective promotional strategies.
- Lower fuel costs helping logistics.
Group Sales and Divisional Contribution
- Total sales rose 9.6% to R128.6 billion for the period.
- Supermarkets RSA division (Shoprite, Usave, Checkers, Checkers Hyper, LiquorShop) made up 83.7% of total sales.
Stronger Profitability Metrics
- Trading profit from ongoing operations increased 13.5% to R7.3 billion.
- Trading margin improved modestly to 5.7%, up from a restated 5.5%.
- EBITDA grew 16.7% to R11.7 billion, versus R10 billion previously.
- Diluted headline earnings per share (HEPS) rose 9.9% to 659.9 cents, from 600.3 cents in H1 FY24.
Store Expansion and Capital Allocation
- 205 new stores added in six months, taking the total count of continuing operations stores to 3,417.
- Capital expenditure for continuing operations represented 3.2% of total sales.
- Shoprite repurchased 3.4 million shares under its authorised buyback programme at a cost of R997 million.
In an operational update, the group said that 68 stores were opened during the first quarter. The majority of these, 53 stores, were opened in the core South African supermarkets segment around which the group-wide ecosystem strategy was built.
According to Shoprite‘s latest financial reports the company’s current revenue (TTM) is $13.34 Billion USD. In 2024 the company made a revenue of $13.34 Billion USD an increase over the revenue in the year 2023 that were of $11.41 Billion USD. The revenue is the total amount of income that a company generates by the sale of goods or services.
Financial Strength and Revenue Growth
Shoprite’s most recent financial filings indicate trailing twelve-month (TTM) revenue of $13.34 billion USD—an increase from $11.41 billion in 2023. This growth highlights the retailer’s ability to maintain scale and profitability in a tough consumer environment marked by elevated inflation and heightened price competition.
Conclusion: Shoprite Holdings continues to demonstrate impressive operational execution and sales growth despite structural pressures in the South African retail market. While price-sensitive shoppers are exploring alternatives, Shoprite’s scale, supply chain efficiencies, and aggressive expansion strategy provide it with the tools to defend its leadership position.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Save