BJC will benefit from Thailand’s reopening and recovering consumer spending through both Big C and its industrial supply chains. We expect falling raw material costs and the potential IPO of Big C to build earnings going forward. BUY!
BJC is much more than a grocer
BJC’s earnings streams are much more diverse than the other Retail stocks we cover. In addition to Big C, it has industrial supply chains and logistics operations in Thailand, Vietnam, and Malaysia. As such, BJC is both a retailer that will benefit from reopening and a maker of consumer-related products (such as glass- and can-packaging for beverages, tissue paper, soap, and potato chips), demand for which is rising in tandem with ASEAN’s post-COVID recovery. More importantly, we expect a margin recovery, espec-ially in 2023, as the prices of several key raw materials, chiefly aluminum and palm oil, are trending down (Figure 3-7).