Today‘s Morning Meeting: Insights into the price war: Clicks continues to lose the battle to Dis-Chem on pricing

研报英文原文证据摘录

Today‘s Morning Meeting: Insights into the price war: Clicks continues to lose the battle to Dis-Chem on pricing

CEEMEA Equity Research

CEEMEA First to Market 29 July 2026

Today’s Morning Meeting | Also Published Today | Key Changes | JPM Events | Upcoming Earnings

Today’s Morning Meeting

South African Drug Retail (Shaun Chauke)

Insights into the price war: Clicks continues to lose the battle to Dis-Chem on pricing

In this note, we introduce our new SA drug retail pricing survey covering Clicks and Dis-Chem. We tracked a 33-item branded

basket alongside a promotional basket, and the message is clear: price competition is intensifying and looks set to remain a

defining feature of the earnings outlook. Dis-Chem continues to price aggressively and, on our branded basket, it screens 5.8%

cheaper than Clicks before accounting for base discounts and the various rewards overlays (Life, pharmacy and Capitec

boost). Adjusting for the relative strength of Dis-Chem’s rewards proposition, we estimate the effective discount to Clicks could

be closer to 10-15%. Promotions reinforce the same point: promotional participation in our sample basket is materially higher at

Dis-Chem (66.7%) versus Clicks (51.5%). This supports the “price-war” dynamic we flagged in our downgrade note, in which

we cut earnings estimates by 10-15% on the view that elevated price investment would persist for at least the next ~18 months.

We also broaden the lens by introducing a 20-item cross-channel basket that compares SA drug retail with front-shop

competition from food retailers (Checkers, Woolworths, Spar and Pick ’Pay). Here, Checkers is 6.5% cheaper than Clicks and

1.8% cheaper than Dis-Chem, highlighting Shoprite as the key swing factor for the category. In our view, the competitive threat