乐购：阿斯达与乐购的阿尔迪价格匹配重演-无价格战

F25E12.71.10.00.20.10.13.96 Jun 2025387.30430.00398.00/300.801,444.1525,91935,9526M6.514.1(7.6)06/2512001300140015001600 F26E3.5% RatingOutperformPrice TargetTSCO.LNAdjusted EPSTSCO.LN (GBP)Source: Bloomberg, Bernstein estimates and analysis.Fears over ASDA’s price investments in the UK remain, despite a lack of any material impacton ASDA’s current weak market share trajectory. In this note, we revisit our analysis fromMarch (see link here) to understand if ASDA is pressuring on core, centre-of-plate SKUs.They are not.There is no threat to core pricing in the UKat the moment. Tesco & Aldido not need to massively react. They are winning on price perception. They are winning onmarket share. ASDA is not being irrational and hasn’t guided to irrationality (FCF flat). ASDAis fighting on a long-tail of less important, lower volume SKUs where it has become tooexpensive, not altering the core. Tesco & Aldi can capitalise on their strength with brands tomatch these discounts without massively impacting their profits.1) ASDA still remains too expensiveon core, high volumes SKUs with 56% products moreexpensive than Tesco & Aldi on the core 628 product base.2) Even after price investments& Roll-Back, 56% products were still more expensive.24% products were cheaperthan Tesco/Aldi post-Rollback but most of these were <5% cheaper. Some of the bigvariations were brands like Haribo which were on promotion.3) There are fewer Rollbackpromotions at the moment than in Marchwith 10% SKUs on promotion in March vs. just5% in June leading to Asda’s median and mean price gap actually widening from 0% to 3%(median) and 14-15% to 16% (mean).4) Inflation levels across are broadly the sameacross Tesco/Aldi(+1.44%) and Asda (+1.39%) on our core product subset.Investment ImplicationsWe rate Tesco Outperform with a price target of £4.30. Our price target is based on anaverage of a PE (13x), EV/EBITDA (7.5x) and FCF yield (8%), on our NTM+1 estimates.The next catalysts are: 1) Q1 earnings on Thursday 12thJune where we expect broadly inline results at +3.2-3.3% UK, ROI & Booker LFLs but we’re unlikely to see any meaningfulcomments on ASDA; 2) H1 earnings in October to show limited margin impact, signallinglimited ASDA impact; 3) FY25/26 profit guidance beat / upgrade.See the Disclosure Appendix of this report for required disclosures, analyst certifications and otherimportant information. Alternatively, visit our Global Research Disclosure Website.First Published: 10 Jun 2025 04:00 UTC Completion Date: 09 Jun 2025 13:25 UTC 430.00 GBpF26E0.32FinancialsRevenues (M)Pre-Tax Earnings (M)Net Debt (Cash) (M)CapEx (M)FCF (M)EBITDA Margin (%) CAGR2.8%2.2%10.1%(9.0)%3.0%--Close DateEDMFYEDiv YieldEV (GBp) (M)PerformanceAbsolute (%)EDM (%)Relative (%)420p400p380p360p340p320p300p06/24 F24AF25E0.270.31F24AF25EF26E69,92471,76473,8252,5882,6652,70410,33912,40112,532(1,692)(1,400)(1,400)1,7501,7851,8587.06.96.8 DETAILSRECENT NOTES & MODELS:Company Model | TSCO.LN / Tesco PLC11 Apr 2025 - Tesco: Flexibility & firepower in a standoff9 Apr 2025 - Tesco: Best Idea Second Quarter 2025 - Every Little (Still) Helps. Outperform28 Mar 2025 - Tesco/Sainsbury's: An ASDA shopper focus group - mixed feedback with too many price increases highlighted27 Mar 2025 - Tesco: ASDA vs. Tesco's Aldi Price Match26 Mar 2025 - Tesco/Sainsbury's: UK Profit pool deep-dive - The strong get stronger, the weak get weaker; Tesco strong25 Mar 2025 - Tesco: ASDA Rollback vs. Tesco price comparison deep-dive24 Mar 2025 - Tesco: The threat (or lack thereof) of ASDAWe look at 759 products that are currently matched to Aldi and manually identify similar or identical products to look at the pricegap. Of the 630 products, we could match 567 products.We think this is a good methodology of tracking effective price competition in the market given that these SKUs are typically thehighest volume and most price perception building SKUs in a grocery store. The list includes everything from private label milk,bread and chicken to Coca-Cola and other key brands. We find either identical or similar products in the same private label tiers.Where volumes or weights differ, we create a pro-rata price (similar to the methodology that Tesco uses to match Aldi).1) ASDA still remains too expensiveon core, high volumes SKUs with 56% products more expensive than Tesco & Aldi on thecore 628 product base.2) Even after price investments & Roll-Back, 56% products were still more expensive.24% products were cheaper thanTesco/Aldi post-Rollback but most of these were <5% cheaper. Some of the big variations were brands like Haribo which wereon promotion.3) There are fewer Rollback promotions at the moment than in Marchwith 10% SKUs on promotion in March vs. just 5% inJune leading to Asda’s median and mean price gap actually widening from 0% to 3% (median) and 14-15% to 16% (mean).4) Inflation levels across are broadly the same across Tesco/Aldi(+1.44%) and Asda (+1.39%) across 464 products thatwe have comparable d