DAOL Securities (Thailand) has provided an analysis of Central Retail Corporation Public Company Limited (SET: CRC), noting that the company’s Food business in Thailand, as well as continued growth in Vietnam, remains the key driver supporting overall performance.
For the first quarter of 2026, DAOL estimates CRC’s normalized profit at approximately THB 2.5 billion, representing a 1% year-over-year increase and stable quarter-over-quarter performance. Revenue is projected at THB 63 billion, a 2% decrease year-over-year and flat compared to the previous quarter, due partly to overall same-store sales growth (SSSG) remaining at around negative 3-4%.
However, downside risk is contained by the growth in the Food segment, with combined SSSG reaching 2-3%; in Thailand specifically, Food SSSG is expected at 5-6%. In Vietnam, Food SSSG is slightly negative in Thai baht terms due to foreign exchange impacts (-1% to -2%), but remains positive in local currency (VND) at 7-8%. Meanwhile, Vietnam Hardline SSSG is up roughly 10%, reflecting strong demand.
Segments facing weakness include Fashion, which continues to see SSSG of -5% to -6% due to fewer selling days, reduced promotional activities, and weaker consumer sentiment. Thailand’s Hardline SSSG also contracted by 5%, though some recovery signs were evident towards quarter-end, bolstered by demand for construction materials.
Another short-term drag is the absence of the Easy E-receipt program, which previously supported sales by approximately 3-4% year-over-year. Nevertheless, gross profit margin (GPM) showed slight improvement at 26.7% compared to 26.5% in 1Q25, despite a seasonal decline from 28.9% recorded in 4Q25, helping cushion top-line pressures.
Selling, general, and administrative expenses (SG&A) are estimated at THB 17.1 billion, down 3% year-over-year and 7% quarter-over-quarter. The SG&A to sales ratio improved to 27.1%, from 27.4% in 1Q25 and 29.0% in 4Q25, reflecting effective cost control, particularly reduced promotional spending.
Although there are headwinds from energy and logistics costs, their impact remains limited. In an extreme scenario where energy costs spike (Ft surcharge up by 16% to THB 4.5 per unit and fuel/transport costs double without solar mitigation), the total cost would increase by only about 1% of sales.
DAOL Securities maintains its normalized profit forecasts for 2026 and 2027 at THB 8.0 billion and THB 8.9 billion, respectively (representing changes of -2% and +12% year-over-year), reflecting a continued revenue growth across all segments. While Food remains the primary growth driver—led by Wholesale business and branch expansion—GPM recovery as Fashion inventories normalize is also expected to support overall profitability.
These factors are anticipated to offset the ongoing negative SSSG expected in 1Q26. Net profit is projected to be steady year-over-year, despite the absence of last year’s Easy E-receipt tax incentive, as Food and Vietnam operations continue to recover.
In terms of valuation, DAOL reiterates its ‘Buy’ rating on CRC with a target price of THB 21.50 per share, based on a 2026 PER of 16 times (1.5 standard deviations below the five-year average). The brokerage believes the current share price already reflects much of the short-term downside risk.
While 2026 profit may contract slightly from the previous year, this is expected to be offset by a rebound in consumer demand, branch expansion, and accelerated business growth in Vietnam, all of which should drive future growth, with additional upside potential from M&A opportunities in 2026–27.
