JEF Supermarket Inflation Index: Early Signs of Inflation Emerging

Research evidence excerpt

JEF Supermarket Inflation Index: Early Signs of Inflation Emerging

Australia | Consumer EquityJulyResearch6, 2026

Figure 1 - Companies FeaturedJEF Supermarket Inflation Index: Early Signs

Woolworths (WOW-AU) HOLD PT: $32.00

June yr end FY25A FY26E FY27Eof Inflation Emerging PE 34.9x 31.7x 29.7x

EV/EBITDA 11.3x 10.6x 10.1x

Slower fresh inflation constrained overall inflation in June qtr, but packaged Div yield 2.1% 2.3% 2.5%

inflation accelerated, likely due to US/Iran war. We believe this is just Coles (COL-AU) BUY PT: $25.50 June yr end FY25A FY26E FY27E

the beginning and expect food inflation to build over remainder of CY26. PE 28.2x 24.7x 23.1x

EV/EBITDA 10.3x 9.5x 9.1x

However, there are signs of continued price investment from supermarkets, Div yield 3.0% 3.3% 3.6%

particularly in private label. Food inflation should be a sales tailwind, but Metcash (MTS-AU) BUY PT: $3.50

April yr end FY26A FY27E FY28E

margin expansion will likely be constrained by political & media scrutiny. PE 12.4x 12.2x 11.5x

EV/EBITDA 6.8x 6.4x 6.1x

. Div yield 5.9% 5.9% 6.3%

JEF Supermarket Inflation Index - This proprietary index follows prices of six discrete Source: Jefferies

baskets across major supermarkets. Long-life, fresh, tobacco & non-food categories are

Figure 2 - JEF inflation index - base 100

represented across branded and private-label in appropriate proportions. It provides insights 165

into food inflation trends, ahead of releases from listed supermarkets and ABS CPI. We track 155

pricing weekly to capture the weekly promotion cycle, but acknowledge inflation is difficult to 145135

definitively measure-fixed baskets like this one (and ABS CPI) tend to understate the impact of 125115

promotions, while moving baskets tend to overstate price drag from promotions. 105