Investment Rating - The report does not explicitly provide an investment rating for the Southeast Asia Staples and Discretionary sectors, but it highlights various performance metrics and trends across different countries in the region. Core Insights - Commodity prices have generally fallen across most regions, contributing to a decrease in inflation rates in several Southeast Asian countries [2][9] - Economic growth in Southeast Asia is expected to maintain a moderate pace in the second half of 2025, with overall growth rates projected between 4% and 5% [3] - Consumer confidence varies significantly across the region, with Indonesia experiencing a notable decline in consumer sentiment [20] Economic Overview - In May 2025, Thailand's CPI decreased by 0.57%, marking two consecutive months of deflation, primarily driven by lower food and energy prices [2][23] - Malaysia's inflation rate fell to 1.2%, the lowest in 51 months, while Vietnam's CPI increased by 3.24%, indicating moderate inflation [2][9] - The overall economic activity in Indonesia showed signs of slowing, with GDP growth in 1Q25 at 4.87%, the lowest since 3Q21 [15] Consumer Sector Performance - In May 2025, Indonesia's essential and discretionary consumption sectors saw increases of 6.55% and 6.17%, respectively, outperforming the index [4] - The consumer confidence index in Indonesia dropped to 117.50, the lowest since September 2022, reflecting concerns about job availability and economic conditions [20] - Singapore's food and beverage sales reached SGD 9.5 billion in May 2025, marking a year-on-year growth of 1.9% [34] Market Trends - The report indicates that most consumer sectors in May 2025 experienced valuation increases, with Indonesia's essential and discretionary consumption PE historical percentiles at 5% and 17%, respectively [4] - The stock market performance in May showed mixed results, with Indonesia's essential consumption sector outperforming the index, while Thailand's discretionary consumption sector lagged [4][14] - Vietnam's essential and discretionary consumption sectors underperformed the index, with growth rates of 2.64% and 3.72%, respectively [4] Inflation and Pricing Trends - In May 2025, Indonesia's CPI rose by 1.60% year-on-year, with core inflation dropping to 2.40%, providing room for monetary policy adjustments [18] - Thailand's consumer price index showed a significant decline, while Singapore's core inflation remained low at 0.6% [31][23] - Vietnam's CPI increased by 3.24% in May, driven by rising costs in housing, utilities, and food services [39]

Investment Rating - The report does not specify explicit investment ratings for the Southeast Asia Staples and Discretionary sectors. Core Insights - Economic growth in Indonesia and Thailand has slowed, with Indonesia's GDP growth at 4.87% year-on-year in Q1 2025, the lowest since Q3 2021, primarily due to weak domestic consumption and reduced government spending [15] - Thailand's GDP growth was 3.1% year-on-year in Q1 2025, exceeding expectations but lower than the previous quarter's 3.3% [23] Economic Data - Indonesia's GDP growth in Q1 2025 was 4.87%, marking a decline from previous quarters, influenced by weak domestic consumption and government spending cuts [15] - Thailand's GDP growth in Q1 2025 was 3.1%, showing a slowdown from the previous quarter's 3.3% [23] - Vietnam's GDP growth reached 6.93% in Q1 2025, the highest for the first quarter from 2020 to 2025 [37] Inflation Trends - In April 2025, Indonesia's CPI increased by 1.95% year-on-year, driven by a rebound in consumption during the Eid holiday [18] - Thailand experienced its first deflation since March 2024, with a CPI decrease of 0.22% in March 2025 [24] - Vietnam's CPI rose by 3.12% year-on-year in April 2025, with core inflation increasing to 3.14% [2] Consumer Sentiment and Retail Performance - Consumer confidence in Indonesia declined, with the consumer confidence index at 121.10 in March 2025, down from 123.80 in the previous year [20] - Malaysia's leading index rose to 112.5 in March 2025, indicating potential future economic activity [3] - In April 2025, Vietnam's retail sales index for food and beverages showed a year-on-year decline of 1.66% [20] Market Performance - In April 2025, stock indices in Indonesia, Thailand, and Malaysia rose by 3.9%, 2.5%, and 1.8% respectively, while Singapore and Vietnam indices fell by 3.4% and 6.9% [13] - The report highlights that only Vietnam's consumer sectors outperformed the indices, while other markets' consumer sectors lagged [3] Valuation Metrics - As of April 2025, Indonesia's essential and discretionary consumer sectors had historical PE ratios at 1% and 3% respectively, while Thailand's were at 4% and 62% [4] - Singapore's essential and discretionary consumer sectors had historical PE ratios of 36% and 33% respectively [4]