Shoprite Retreats in South Africa As Food Price Soar – JSE: SHP Share Volatility but Trend’s Still Up
Even though Shoprite is leaving more African markets to concentrate on South Africa, its share price has increased continuously since 2020..
Quick overview
- Shoprite is strategically exiting several African markets, including Ghana and Malawi, to refocus on its core operations in South Africa.
- Despite reducing its international footprint, Shoprite's share price has shown resilience, climbing from below R100 in 2020 to over R313 in late 2024.
- The company's stock experienced a pullback in early 2025 but found support at the 50-week simple moving average, indicating investor confidence in its South African focus.
- Shoprite's future growth will depend on its ability to maintain operational efficiency domestically while addressing economic challenges in South Africa.
Even though Shoprite is leaving more African markets to concentrate on South Africa, its share price has increased continuously since 2020, indicating a strategy shift that is changing the company’s growth trajectory.
Strategic Retreat from African Markets
Shoprite, South Africa’s largest grocery retailer, has confirmed its exit from Ghana and Malawi as part of a continued effort to scale back its African footprint. Once determined to dominate food retail across the continent, the group expanded into about 15 countries and overtook competitors like Pick n Pay and Walmart-owned Massmart to become Africa’s biggest supermarket operator.
Despite these ambitions, success proved elusive. Operations outside South Africa were hampered by a combination of weak local currencies, surging inflation, heavy import duties, and rent often charged in U.S. dollars. These headwinds made it increasingly difficult for Shoprite to maintain profitability in several markets.
Share Price Resilience Amid Strategic Refocus
While the company’s footprint across Africa has shrunk, its share price has demonstrated surprising strength. Since 2020, Shoprite’s shares rallied from below R100 to climb above R313 in late 2024. However, the first quarter of 2025 saw a sharp pullback of about 24%, bringing prices down to around R235.
SHPJ Chart Monthly – The 50 SMA Is Holding As Support
Support at the 50-week simple moving average (SMA) provided a foundation for recovery as investors held faith in the company’s South African focus. The rebound, however, was tempered by consumer concerns over rising food prices and the threat of boycotts, which weighed on sentiment earlier this year.
Technical Levels Reinforce Investor Confidence
By August 2025, the 50-week SMA once again acted as a critical support level, helping to sustain investor confidence. The stock has since rebounded over the last two months, closing at R287 yesterday. The ability of Shoprite shares to recover even as the company scales back internationally underscores investor belief that focusing on the home market could yield steadier growth.
Outlook: A Leaner, More Focused Retailer
Shoprite’s strategic exit from selected African markets reflects a shift toward consolidating strength in South Africa, where it still dominates grocery retail. For investors, the challenge will be weighing the benefits of this more focused strategy against the lost potential of broader African expansion.
While the share price momentum remains intact for now, sustaining long-term growth will depend on maintaining operational efficiency at home and navigating South Africa’s own economic challenges.
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