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SEM’s convenience store (CVS) sales are expected to increase in 4Q21 due to store footfall improvement and longer operational hours. It has also launched a new concept store ‘7 Café’ which aims to lift gross profit margins in the long-run, given its focus on fresh food products. Our HOLD call, TP of MYR1.55 (27x FY22 PER) and earnings estimates are unchanged. Note that we do not expect any earnings impact from Cukai Makmur as its chargeable income is below the MYR100m tax threshold.

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