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FamilyMart seen to benefit from EasyCard partnership, expansion plans
Central News Agency
2014-08-25 01:43 PM
Taipei, Aug. 25 (CNA) FamilyMart, Taiwan's second-largest convenience store chain, is expected to benefit from its partnership with contactless smart card system operator EasyCard Corp. to launch a rewards point system, according to financial services firm Morgan Stanley. Terrence Cheng, a Taipei-based analyst with Morgan Stanley, said that EasyCard compatibility is likely to help boost consumer stickiness and small payments at the ubiquitous convenience stores because EasyCard has issued more than 47 million prepaid cards that area already widely used for public transportation. "We expect FamilyMart to benefit from its collaboration with EasyCard in a bonus point platform that brings in more traffic to both accumulate points and redeem them," Cheng said in a research note last week. Taiwan FamilyMart Co. and EasyCard teamed up earlier this year to develop the system to help shoppers earn and use reward points at FamilyMart, as well as making bill paying at the one-stop shops more convenient. Cheng said he is optimistic about FamilyMart's improving execution and marketing strategy, evidenced by its 5-6 percent growth in same-store sales in the first half of 2014, compared with about 1 percent recorded by the market leader President Chain Store Corp., which operates 7-Eleven, the biggest convenience store chain in the country. FamilyMart's development plans for China also provide "a long-term bright spot" given the chain's well-established image and ambition for expansion, the analyst said. He gave an "overweight" rating to the stock with a price target of NT$250 (US$8.35). In contrast, President Chain Store was rated "underweight" with a NT$195 price target due to the limited user base of its in-house iCash prepaid cards, Cheng said. Shares of FamilyMart had fallen 0.72 percent to NT$207.0 as of 12:24 p.m. Monday in Taipei, while President Chain Store had declined 0.22 percent to NT$223.0. (By Jeffrey Wu)
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