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Three of the largest grocery chains in Turkey have made excessively high profits over the past five years, according to a recent report by Citibank.
The analysis report titled "Turkey's Supermarkets" delves into the impact of exchange rate and inflation volatility on retailers in the country, focusing on three grocery chains (BİM, Migros, and Şok) that are listed on the stock exchange.
Despite the visible rise in the influence of the foreign exchange rates on the consumer inflation rate over the past two years, retailers have managed to sustain their sales and increase their profits without being significantly affected by inflation notes the report. This is caused by the fact that major retail companies in Turkey directly pass on the price hikes to consumers.
The report further reveals that the operating profit of the three grocery chains listed on the stock exchange has experienced an impressive 150% surge in US dollars since 2018.
Citibank also suggests that these prominent retailers anticipate continuous growth by gaining market share from conventional distribution channels.
As per the inflation data released by the Turkish Statistical Institute TurkStat, consumer food inflation in Turkey hovered around 68% in March 2023. This figure represents a slight decline from the 70% recorded in March 2022.
Additionally, The Economist's food security index indicates that Turkey's food purchasing power witnessed a 16-point drop between 2012 and 2022.
Government officials have frequently blamed large grocery chains for the soaring food prices in the country, accusing them of "profiteering." (HA/VK)
