The shift in Singapore's consumption toward the health and beauty segment is likely to benefit DFI Retail Group given its exposure to this area, DBS Group Research's Zheng Feng Chee and Andy Sim say in a note.

The country's nondiscretionary spending grew 4% on year in the first 10 months of 2025, which the analysts attribute to government vouchers and consumers' higher preference for health and beauty products over apparel.

A broader wellness trend is likely to continue supporting health and beauty spending, Chee and Sim say.

Singapore-listed DFI, which operates brands across food, health and beauty and convenience stores, also has a more attractive valuation than retail peer Sheng Siong Group, the analysts add.

DBS maintains a buy rating and US$4.50 target on DFI, which rises 0.8% to US$3.93.