Updates with Woolworths comments
** Analysts at Morgan Stanley say Australian retailer Coles COL.AX is closing margin gap with its larger rival Woolworths WOW.AX
** Brokerage lifts PT on Coles to A$21.7 from A$18.4; upgrades stock rating to "over-weight" from "equal-weight"
** Trims PT on Woolworths to A$33 from A$34, maintains "over-weight" rating
** Coles has taken 30 basis points of relative share from WOW over 1H24-1H25, driven by better consumer price perception, optimised promo spend and share gains from WOW industrial action - Morgan Stanley
** While WOW is expected to see a great uplift in EBIT margins till FY26 end, COL has meaningfully closed the margin gap to WOW - brokerage
** While WOW is earning more money in e-commerce, COL is winning relative market share - a trend expected to continue - brokerage
** COL's ability to take 50% incremental share of WOW's lost sales during the industrial action period in Q2 suggests a material step up in the quality of COL's supply chain - Morgan Stanley
** Coles up 1.1%, while WOW down 1.6%, during the day trade
(Reporting by Rishav Chatterjee in Bengaluru)
((Rishav.Chatterjee@thomsonreuters.com))
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