Even South Africa’s Best Clothing Retailer Is Down This Year
South Africa’s apparel retailers are having a tough 2026. Even Mr Price, the best performer in the sector, has seen its share price slip 1.13% year to date, which equates to a market capitalisation decline of about R240 million since January. More striking is that not one JSE-listed apparel retailer has seen its share price rise this year.
The scoreboard
A Daily Investor analysis in October showed how the sector has fared year to date:
| Retailer |
Share price, year to date |
| Mr Price |
-1.13% |
| Truworths |
-18.84% |
| Pepkor |
-31.63% |
| TFG |
-41.29% |
Allan Gray portfolio manager Rory Kutisker-Jacobson noted on 13 October that the spread between retailers is extreme. At that point he had Mr Price down 7%, while Foschini had fallen a staggering 43%, with Pepkor and Truworths in between. Mr Price has since recovered, which is why its decline has narrowed to 1.13%.
Why the sector is under pressure
PSG Financial Services wealth manager Schalk Louw says the main driver is downward revisions to forward earnings expectations. A weak consumer, squeezed further by higher fuel prices and interest rates, is coinciding with margin pressure from discounting and no clear sign of recovery. Analysts and investors have cut next year’s earnings forecasts, and valuations across the sector have de-rated as a result.
Investors are also worried that retailers will have to give up margin to stay competitive. The shift towards low-cost online rivals reflects a lasting change in industry economics rather than a passing cycle, Louw said, which makes it harder to argue for a near-term re-rating until earnings stabilise.
A squeeze from demand and margins
- Demand: Household budgets are stretched, and because clothing is discretionary, it’s typically the first category consumers cut.
- International competition: Chinese e-commerce players such as Shein and Temu, as well as traditional brands like H&M, are intensifying pressure.
- Local competition: Grocery retailers such as Shoprite and Pick n Pay are pushing further into apparel.
- Margins: More promotions and limited pricing power make it hard to pass on cost inflation, so earnings growth is increasingly difficult to deliver.
Why Mr Price stands out
Louw identified Mr Price as the standout performer, pointing to:
- Resilient revenue growth
- Improving margins
- Disciplined cost control
- Value positioning suited to a price-sensitive consumer
- Scale and operational efficiency that let it compete on price without sacrificing profitability
In Louw’s view, that mix of top-line resilience and margin discipline is what he looks for in a defensive operator.
Risks that remain
Even Mr Price isn’t risk-free. Louw flagged:
- Competition from international online platforms
- A premium valuation relative to peers
- Execution risk tied to its offshore investment in NKD Group
Still, he maintained that Mr Price’s execution has been the strongest in the sector.
The bottom line
The clothing sector’s problems are both cyclical and structural: stretched consumers on one side, and a tougher competitive landscape on the other. Mr Price shows that scale, value pricing and cost discipline can still hold up, but until retailers show earnings stabilising, share prices across the sector are likely to stay under pressure. This post is a summary of analyst commentary, not investment advice, so speak to a licensed financial adviser before making investment decisions.
Source: Daily Investor analysis, with commentary from Allan Gray and PSG Financial Services (23 October 2026).
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