My S.W.O.T Analysis For Jumbo (42R)

Jumbo Share Price

When I think of Jumbo, the first thing that comes to my mind is their chilli crabs! Whenever I think of it, I can’t help but want to dip their delicious fried mantou buns into that savoury chilli sauce! Jumbo is one of the few companies that have done very well after IPO and seems to be on track to do even better. It IPO-ed at $0.25, look at how much it has risen already! This week, we take a closer look at Jumbo beyond just its chilli crabs, and see if it’s worth buying into!


  1. Renowned Brand Name
  2. Strong Demand Even Overseas
  3. Cash Cash Cash!

Renowned Brand Name

Jumbo has always been popular amongst Singaporeans. For me, it’s the only place I think of when someone mentions ‘Chilli Crab’. They have managed to capture a piece of consumers’ minds! Just like how when you think of flu medicine, you think of Panadol. Razor blades, and you think of Gilette. And right here at home, Chilli Crab, and you think of Jumbo! Not only that, this dish has been made even more popular when Gordon Ramsay came over to Singapore for the televised show, ‘Hawker Heroes Challenge’. As a ‘National Dish’, Jumbo works closely with Singapore Tourism Board (STB) to actively promote their chilli crabs!

Strong Demand Even Overseas

Geographical Breakdown

Not only is Jumbo popular with locals and foreigners here in Singapore, Jumbo in Shanghai is doing very well! With just 2 shops in China at end 2015, it already accounts for 8.5% of revenue for the Group! Mr Ang Kiam Meng, CEO, opines that “Even if the economy slows down, we are quite confident that we’ll not be too badly affected.” The brand is quite well-known in the China market, especially in Shanghai, and there are many who have yet to try Jumbo’s food, he adds.” The three restaurants merely scratch the surface of the Shanghai market, explains Mr Ang, adding that the group would have a healthy revenue size for the next few years even if it relied only on first-time customers. – The Business Times

Management has also made it clear that they will be “opening at least 4 additional outlets in the PRC and Singapore in the next 24 months.” – 2015 Annual Report

Cash Cash Cash!

Jumbo is filled with Cash! Not only is it filled with cash, it has a strong free cash flow generating ability! More money means Jumbo can expand into more outlets without having to go into debt. Jumbo is growing at a very sustainable pace and will likely continue to grow without a need for additional funding in the years to come!


Saturation in Singapore

“The group will be slowing down its expansion in Singapore, with just one more outlet planned, targeting the high-end seafood dining space which Mr Ang says is lacking in options.” With the constraints here, “we’ll rather take it easy on the Singapore side and channel our resources to China,” says Mr Ang. “China has what we don’t have in Singapore, which is people.” – The Business Times

It seems that even Mr Ang isn’t optimistic about Singapore anymore. However, instead of opening up more branches, he plans to “increase the number of turns, by opening earlier and closer later.” While it’s a good idea to raise efficiency, there’s still a limitation to it. Its weakness is in its geographical location. Good thing Mr Ang has found a solution to further the business.

Secret Recipe

“Its recipe for the chilli paste, however, is kept secret. It’s made in Singapore and then flown over.”

Allow me to zoom closer. “It’s made in Singapore and then flown over.” I honestly wonder how long they will keep up with this practice.


All Aboard! Next Stop, China!

Now that Singapore is beginning to become too saturated, so will its earnings. But entering Shanghai is like injecting new life into the business. Jumbo Seafood in Shanghai has been well-received by the locals ever since it set foot there. This is good news for Jumbo as its greatest limitation used to be the number of patrons. But that worry has been lifted since Shanghai is a brand new market for Jumbo to target. Shanghai is a huge market and with all the popularity it has garnered here in Singapore and the reputation it has built up for itself, Jumbo should continue to do well.


Aggression or Competition

China as we know it to be, are extremely capable of copying and pasting. I wouldn’t be surprised. Just look at the salted egg yolk craze among the different bread companies here in Singapore. My worry for Jumbo in Shanghai is that if they are not aggressive enough to capture market share, they’ll be enveloped by competition. While branding and quality will help to defend against competition, in the eyes of the Chinese, just a foreign company in Shanghai that hasn’t built that strong of a following, neither is it considered a ‘national dish’ in Shanghai. Let’s hope that Jumbo is not treated just a fad there, but there to actually stay.

Of course, Mr Ang has considered the point of it possibly being just a fad. Yet the sheer size of Shanghai keeps him confident that he opines that “the group would have a healthy revenue size for the next few years even if it relied only on first-time customers.”


Jumbo is a great company that’s truly the pride of Singapore! Even Temasek Holdings gave it a vote of confidence! It’s in a new phase of growth that many look forward to. However, with that being said, I personally feel that a lot of growth has already been factored into Jumbo’s share price, a little too much for my comfort. I’ll be waiting for the opportunity to snag up a good deal on Jumbo should it happen!

Aloysius Lee

Aloysius has been investing in Singapore Equities from the age of 18 and is still madly enthusiastic about it. He strives to sharpen his edge while guiding others along the way to snowball their way to financial freedom!

One thought on “My S.W.O.T Analysis For Jumbo (42R)

  • October 28, 2016 at 11:41 AM


    May I ask to share this counter call Sunright. The net net valuation for Sunright is 48 cents, m I right?

    If that is the case, then Sunright is very under value, because it is trading at 34.5 cents.

    Can share why market give it a miss, business wise not impressive or it is not liquid? Thanks you.



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