Shares of Sheng Siong Group, the budget supermarket chain controlled by tycoon Lim Hock Chee and his brothers, surged on Friday as the government imposed fresh Covid-19 restrictions to stem the rising number of infections in the city.
The measures which will be enforced for four weeks from May 16 to June 13 include banning dining-in at restaurants and limiting gatherings to two people from five currently. Working from home will be the default for most workers, the Ministry of Health said in early afternoon.
Long queues formed in the city’s supermarkets within hours following the announcement, reminiscent of the lockdown imposed by the government last year that caused a shortage of food and other household essentials such as tissue paper.
Shares of Sheng Siong climbed 10.7% to S$1.66 ($1.24) at the close of trading in Singapore. That was the highest close since August 7, 2020 when the shares traded at a record high of S$1.83 per share. The company competes with bigger rivals NTUC Fairprice and the Cold Storage chain owned by Dairy Farm International.
The combined net worth of Lim and his brothers surged 38% to $1.2 billion in August last year as the shares of Sheng Siong rose after shoppers drove up sales by buying supplies to stay home during the pandemic.
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Sheng Siong’s annual net profit jumped 84% to S$139.1 million in 2020, while revenue increased 41% to S$1.39 billion driven by elevated demand for groceries arising from Covid-19.
While Singapore has managed the spread of the virus better than most other countries, there’s been a new wave of infections in recent weeks. The number of new Covid-19 cases in the community has increased to 71 in the past week from 48 in the week before, the government said on Thursday.
More concerning is the increasing number of unlinked or untraceable infections, which climbed to 15 in the past week from 7 in the week before, it said. The spike in unlink cases is casting doubt on whether Singapore and Hong Kong can start a travel bubble as scheduled on May 26. Shares of Singapore Airlines dropped 5.7% at the close.
“A pattern of local unlinked community cases has emerged and is persisting,” the Ministry of Health said in a statement said. “We need to act decisively to contain these risks as any one leak could result in an uncontrolled resurgence of cases.”
Born to a hog farmer with nine children, the Lim brothers bought a struggling chain of stores using S$30,000 borrowed from their father and renamed it Sheng Siong, or “rising vegetable” in Hokkien. Today, Sheng Siong is Singapore’s third-largest supermarket chain by sales, with a market cap of S$2.5 billion.