Kantar Worldpanel said the grocery market grew by 1.3% in the 12 weeks to May 19, compared to last year’s 2.7% when a heatwave, the Royal Wedding and FA Cup final boosted sales.
Tesco maintained a market share of 27.3% in the period with flat sales.
Deutsche Bank kept a ‘buy’ rating on Tesco but lowered its target price to 295p from 300p. It also reduced its estimates for pre-tax profit and revenue for fiscal years 2020-22.
“Quarterly UK retail sales growth ex fuel has a 79% correlation to Kantar data, and while Kantar and Tesco's periods do not perfectly overlap, Kantar suggests that Tesco will report +0.2% retail growth for the first quarter of 2020, close to our expectations,” the bank said.
“We expect the group to report 0.4% sales growth ex fuel, with 0.7% like-for-like growth ex fuel.”