SHOPRITE'S fragile market value has again been shattered after the

supermarket discounter revealed that its recent dire results should, in

fact, have been even worse because of the collapse of a property deal.

Shares in Scotland's leading discount food retailer, as high as 242p

early this year, plummeted 27p to only 51p yesterday in response to the

latest statement. Prices were almost halved after its May figures.

Shoprite had rushed out interims last month because its performance

failed to approach market expectations and the declared pre-tax profits

of #2.7m -- though 62% higher than previously -- included a worryingly

hefty slice of income from property sales.

''Shoprite now regrets to announce that these transactions have not

been completed,'' the Isle of Man-based company said in a brief

statement to the Stock Exchange.

Anticipating a surplus of #1.3m through the sale-and-leaseback scheme

of 11 of its Scottish supermarkets, the company has now been forced to

wipe this expected windfall from the slate.

As a result, pre-tax profits for the six-months to end-May should be

#1.4m instead of #2.7m and earnings per share should be 1.45p against

the 3.05p announced.

Few statements could be better designed to incite panic in the City

and a mass sale of the company's shares was immediate.

''Given the fact that the original results were badly enough received,

it will be some time, if ever, before Stock Market credibility in

Shoprite is restored after the latest announcement,'' said one retail

analyst at NatWest Securities.

The core of the latest problem was a #9.3m sale-and-leaseback deal

involving 11 of its 80 cheap, no-frills stores north of the Border.

Clearly signalled as conditional in the results, it was designed to

release much-needed ready cash for the group's further expansion in the

UK. Shoprite is probably the fastest-growing retailer over the past two

years.

Allied Dunbar and Edge Investments (Scotland) were the two property

companies involved and the stores are sited in Denny, Dundee, Stepps,

Whitburn, Hawick, Perth, Dunbar, Ayr, Bridge of Allan, St Andrews, and

Bearsden.

The potential purchasers, though well aware of the furore, refused to

give any reason for the reversal of their decision.

Shoprite finance director Michael Pridham also insisted that he had

been given no reason for their change of heart, though he admitted that

last month's disappointing figures could have affected sentiment.

''Property values have also changed and, while disappointed about the

sale failure and the market reaction, we are confident that our plans

for expansion will not be hindered,'' he said.

''We intend keeping to our pledge of opening another 30 stores in the

second half of this year and we'll look for other buyers of the stores

which represent only a small percentage of our 85-strong chain.''

With debt remaining around #18m, gearing was not materially increased

by the latest setback though net assets per share have been recalculated

at 48.4p against 50.0p previously.

The likes of Asda, Argyll, and Sainsbury will surely be shedding few

tears over the latest travails of Shoprite which appears to have become

the victim of its own success.

Its aggressive discounting policies have prompted such a strong

reaction from the big chains that gross margins have been absorbed into

the price war that has broken out in the High Street.

The Nicholson family, holding just over half the shares, have seen an

estimated #100m blown away from their holding over the past few months.

Ironically, chairman Deryck Nicholson is son of the founder of

Kwik-Save, another potential rival as competition strengthens north of

the Border.

Shoprite, which is thought to have about 10% of the packaged goods

market in Scotland, has opened 20 stores so far this year and turnover

has risen by almost 60% to #105m.

But confidence has been clearly shaken, and sector analysts were busy

reassessing their previous estimates of profits of #9m for the current

year against last year's #5m. Projections of #13m for 1995 now look way

over the top.

However, the corporate message from the Douglas headquarters was as

bullish as ever. ''The conditions for growth in the discount supermarket

sector are still very strong and it is up to us to produce full-year

results that once again illustrate this view,'' Mr Pridham said.