KGI Securities (Thailand) wrote in its analysis that Maguro Group Public Company Limited (mai: MAGURO) accelerated its branch expansion efforts in the second quarter of 2026, adding four new branches and increasing its total network to 58 outlets. Further momentum is expected in Q3 with at least eight new branch launches, notably including the debut of a new brand, Kaiten Sushi Ginza Onodera, at CentralWorld.
KGI forecasts MAGURO will reach 66 branches by the end of the third quarter and 68–73 by year-end, consistent with management’s full-year target to open 15–20 new branches in 2026.
Earnings for 2Q26 are projected to post growth both year-on-year and quarter-on-quarter, supported by the increased branch count and full-quarter revenue contributions from branches that opened earlier in the year.
Although same-store sales growth (SSSG) remains slightly negative, KGI expects revenue growth to remain robust, with a 29% increase in branch count on a year-over-year basis. Gross margin is anticipated to improve quarter-on-quarter as store promotions ease and newer stores begin contributing to revenue; however, the figure is likely to remain below last year’s level due to increased operating costs.
Selling, general, and administrative (SG&A) expenses are estimated to remain high as MAGURO prepares for additional branch openings in Q3. Consequently, KGI anticipates earnings growth will remain positive in Q2 and strengthen in 2H26, both year-over-year and half-on-half, as ongoing expansion and new brand contributions come into play.
Despite the optimistic top-line outlook, KGI has revised down its 2026–27 earnings forecasts for MAGURO by 16% and 19%, respectively, to THB 165 million (+10% YoY) for 2026 and THB 195 million (+18% YoY) for 2027.
These reductions reflect several headwinds: a 3–4% reduction in revenue assumptions following a cut in SSSG to -3% (from -1%) amid softer market demand and intensifying competition; a lower gross margin assumption of 46% (down from 46.8%) due to first quarter profits and higher costs for raw materials, packaging, and new store openings; and a higher SG&A-to-sales ratio of 36.1% (up from 35.8%) because of this year’s ambitious branch rollout, which includes larger-format stores and higher pre-opening costs. As a result, net margin is forecast to fall to 6.5% in 2026, down from 7.5% in 2025.
In terms of valuation, KGI maintains its price-to-earnings ratio assumption at 16x, but lowers its target price on MAGURO to THB 21.00 from the previous THB 25.00. The brokerage maintains an ‘Outperform’ rating, citing expectations of an 18% compound annual growth rate in earnings from 2026 to 2028.
Despite pressure from margin compression and the costs of rapid expansion in the near term, KGI sees upside potential in the longer term. Notably, MAGURO’s share price has fallen 20% over the past three months, which KGI believes reflects investor concerns over the Middle East tensions and weaker-than-expected first-quarter results.
Nevertheless, MAGURO is currently trading at a price/earnings-to-growth ratio of only 0.4x, well below the peer average of about 1.0x, suggesting an attractive valuation for investors.
