In Singapore, we are spoilt for choices when it comes to food. When it comes to piping hot soup, there is a famous restaurant chain called Soup Restaurant – a local listed company. In this article, we take a brief look at Soup Restaurant Group and understand what sets them apart from other competitors.

Brief Background

Soup Restaurant Group (SRGL) engages in the operation of restaurants. The Group operates 17 restaurant outlets in Singapore and Malaysia, and a franchised outlet in Indonesia under the brand names of TEAHOUSE by Soup Restaurant, CAFÉ O, and POT LUCK.  It is also involved in food processing and distributing activities. The Group was founded in 1991 and is headquartered in Singapore.

Financial Performance

soup financial performance



Source: Company’s Financial Statements

In the latest third quarter ended 30 September 2018, SRGL achieved a nine-month total revenue increase of 7.3 percent to $32.6 million, and net profits attributable to shareholders rose 68.3 percent to $1.7 million during the same period. This is equivalent to a 5.1 percent net profit margin for the nine-month period ending 30 September 2018 as compared to a 3.3 percent net profit margin during the same time period last year.

The Group’s net earnings per share during the nine-month period ended 30 September 2018 came in at $0.60 as compared to $0.36 per share during the same time period last year.

In its SGX filling, the Group disclosed that the year-over-year (YoY) increase in revenues was attributed to the increase in the revenue from operation of restaurants and online delivery services of $1.5 million. Its revenue for the food processing, distribution, and procurement services segment also increased by $0.7 million.

The Group has cash and cash equivalents of $8.8 million and no significant interest-bearing debt on its balance sheet as of 30 September 2018. The Group has a positive net operating cash flow of $2.9 million during the nine-month period ending 30 September 2018, as compared to $2.3 million last year. There were no dividends declared or paid during the third quarter ending 30 September 2018.

Comparing With The Peers

Comparables with Peers
Company Name P/E Div Yield (%) P/BV Market Cap (S$’millions) Total Revenue (S$’millions)
Soup Restaurant Group Limited 17.112 3.13% 4.237 44.790 43.010
Japan Foods Holding Limited 14.705 4.94% 2.203 73.800 68.200
Katrina Group Limited 66.556 1.30% 3.409 46.300 61.100
No Signboard Holdings Limited N/A 1.87% 2.912 64.300 26.500
Sakae Holdings Limited 6.281 N/A 0.485 20.200 56.800
Tung Lok Restaurants (2000) Limited N/A N/A 3.316 48.800 86.600
Jumbo Group Limited 21.249 3.20% 3.681 240.410 153.050

Source: SGX Stockfacts

While a majority of the restaurant group peers have relatively high price-to-earnings (P/E) multiples, SRGL ranks somewhat in the middle.

One of the differentiating factors that SRGL might have as compared to its peers is that the Group specialises in soups and its food concepts are revolved around the “soup” theme. There are currently no known listed competitors in Singapore and Malaysia that we know of that specialises in the retail of “soups”.

Although there might be one privately run operation called “The Soup Spoon” that offers soups in its menus, we think that SRGL is not competing in the same turf with as it specialises in oriental style of soups.


SRGL is currently under no research coverage by the major brokerages. Although the price-to-earnings (P/E) multiple is high at around 17 to 18 times based on historical earnings, the Group is ranked somewhere in the middle on a relative basis. The stock also offers a reasonable twelve-month dividend yield of 3.1 percent.

SRGL does have some room for further growth, along with cash and cash equivalents of $8.8 million and has almost-zero debt as of end September 2018. This provides some ample leeway to grow.

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