Foreign Secretary Dominic Raab might insist it is too early to talk about an exit strategy away from the coronavirus lockdown, but some UK consumers are seemingly already planning a shopping spree once they are let out of their homes.
However, as Berenberg points out, the pace of return to normality will depend on how Westminster eases restrictions.
The leisure, hospitality and retail sectors were hit the hardest, though recovery may not be as speedy as the fall.
“Younger generations may bounce back quicker than older age cohorts,” analysts at the German firm said.
“Consumers will obviously get back to spending but will be more cautious, at least early on.”
Global tourism will be the slowest, while discretionary items, such as luxury goods, are also expected to lag.
New look for retailers
How industries look will also be very different, with retail in particular already seeing the start of the changes.
“A number of debt-laden and weaker retailers are moving towards administration, according to weekend press reports, including Debenhams and Cath Kidston,” Peel Hunt said.
“All of this plays towards a strengthened market position for the rest of the sector as the demise of less consumer-relevant formats accelerates.”
Analysts see JD Sports Fashion PLC (LON:JD.) as one of the fashion retailers to emerge stronger from the crisis, thanks to its previous success in trading and strong balance sheet, with £300mln in cash and nearly £1bn of facilities.
However, last Friday the FTSE 100-listed giant sold its headquarters and three warehouses to help the business cope from the lack of sales, after closing both physical stores and online operations.
The AIM-listed firm raised £15mln through a share placing, which house broker Peel Hunt says should be enough to navigate the current disruption.
Rush to the pub
The hospitality sector is perhaps in better shape, thanks to government support, rental negotiation and fewer issues than retail when it comes to stock.
Restaurant Group PLC (LON:RTN) should have sufficient liquidity almost to see out the rest of 2020 under closure, Peel Hunt said, which is “very different to many private restaurant chains”, pointing to the administration of Carluccio’s and potential collapse of GBK.
Similarly, pub company Fuller, Smith & Turner PLC (LON:FSTA) has implemented a series of cost-savings measures that analysts at Liberum believe will sustain the company through eight months of closures.
Apparently these are now available at Boots pic.twitter.com/KMkRnvhsOB
— Manc Pictures ???? (@Manc_Pictures) March 31, 2020