Kuala Lumpur, 11 September 2025 – Discount retailer Eco-Shop Marketing Bhd continues to command a premium market valuation, thanks to a combination of aggressive promotions, rapid outlet expansion, and resilient sales strategies, according to a research note by RHB Investment Bank Bhd (RHB IB).
Malaysia’s largest dollar-store operator, Eco-Shop has strengthened its appeal among value-driven consumers with campaigns such as “Sama Bantu”, which temporarily reduced prices on selected food and beverage items back to RM2.40, alongside attractive purchase-with-purchase deals. These strategies, RHB IB said, have proven effective in drawing foot traffic and encouraging repeat purchases at a time when household spending remains sensitive to inflationary pressures.
RHB IB reaffirmed its “Buy” recommendation on Eco-Shop with a target price of RM1.51, representing an upside potential of roughly 13% from current trading levels. Analyst Soong Wei Siang noted that after recording negative same-store sales growth (SSSG) in the fourth quarter, Eco-Shop pivoted toward more aggressive marketing measures that have successfully revived consumer demand.
“We anticipate an encouraging improvement to SSSG trends going forward,” Soong said, adding that the company remains on track to deliver its 5% SSSG target, supported by enhanced marketing efforts and improved stock availability.
Expansion and Refurbishment Plans
Eco-Shop currently operates 371 outlets nationwide and has already secured more than 70 new locations to fuel its expansion drive. At the same time, the group plans to refurbish about 20 older outlets with modernised layouts by year-end. RHB IB said these upgrades are expected to boost store productivity and could further drive SSSG if results prove encouraging.
The company has also aligned itself with government initiatives. As of now, 159 Eco-Shop stores have been enabled for the Sumbangan Asas Rahmah (SARa) programme, which allows low-income households to redeem essential items. While the immediate sales impact has been modest—given that many beneficiaries continue to favour hypermarkets and mini-markets for redemptions—the programme positions Eco-Shop as a socially responsive retailer.
Financial Cushion and Premium Case
From a financial standpoint, Eco-Shop has demonstrated robust profitability. RHB IB highlighted the company’s 4.7 percentage-point expansion in gross profit margins year-on-year in the fourth quarter, a buffer that should help absorb the impact of new costs, including the Sales and Service Tax (SST) on rentals and higher Employees Provident Fund (EPF) contributions for foreign workers starting October.
“Eco-Shop offers earnings visibility and robust growth. Such a scarce investment case should justify its premium valuation,” RHB IB said, noting that few consumer retail companies in Malaysia combine aggressive expansion, consistent earnings momentum, and a proven ability to adapt quickly to shifting consumer trends.
