India’s food super-app hits new gluttonous heights 14 Mar 2022 Food delivery group Swiggy’s ramp up of its rapid grocery service is locking in higher-spending users, giving the Prosus-backed firm an edge over Zomato. But the tech rout and ugly economics of speedy deliveries suggest a $10 bln valuation is better served up in private markets.
Russian shoppers weaken case for companies to stay 11 Mar 2022 Adidas and Unilever are among those cutting back in the country. They make way for locals such as retailer Magnit and Asian consumer giants that stick around to gain market share. The effect of sanctions on disposable incomes, however, makes the financial logic less compelling.
Capital Calls: Argentina, Oligarch yachts 4 Mar 2022 Concise views on global finance: Argentina’s $45 bln debt deal is hope trumping experience; Floating assets sometimes worth more than $500 million each are worthy sanctions targets.
Meituan sums up struggle to solve Beijing riddles 2 Mar 2022 The food-delivery giant lost $28 bln in market value after regulators suggested last month that merchant charges should be cut. State media later downplayed the guidance, but now the company is lowering some fees. It’s a classic case of why investing in Chinese tech is so hard.
Budweiser’s foam will be hard for ThaiBev to brew 24 Feb 2022 AB InBev’s Asian spinoff grew 2021 net profit by 76%, helped by premium pricing and a recovery in volume. The results bolster the case for its Bangkok-based rival to revive a beer IPO plan. The valuation, however, should be more sobering than Bud’s 36 times expected earnings.
Capital Calls: Macy’s activist wins despite rebuff 23 Feb 2022 Concise views on global finance: Though the retailer rebuffed Jana Partners’ efforts to separate its e-commerce business, refocusing investors likely delivered a healthy return for the pushy shareholder.
7-Eleven clash shapes up to be Mt. Fuji moment 22 Feb 2022 Emboldened by its success in Japan, normally discreet ValueAct is publicly chiding Seven & i’s structure and governance. The $44 bln retailer has dug in after previously fending off Dan Loeb. Winning over local fund managers would help a bubbling flow of pushy investing to erupt.
Hasbro breakup is the monster under the bed 18 Feb 2022 An activist wants the toymaker to spin out the division that holds card game “Magic: The Gathering”. The alternative is for incoming CEO Chris Cocks to revive a plan to become a Disney-like media empire. Cocks deserves a chance, but the allure of a carve-up sets him a high bar.
Capital Calls: DraftKings, Shake Shack, Fanatics 18 Feb 2022 Concise views on global finance: The online gambling firm predicts fast growth but heavy losses; the U.S. burger chain had disappointing earnings yet its valuation is sky-high; the sports merchandiser teams up with Jay-Z to buy a streetwear firm for a song.
Walmart’s trusty talent is less use in new domain 17 Feb 2022 The $375 bln company’s stronger-than-expected sales and profit are testament to its ability to manage inflation and supply chain pressures. A push into advertising and subscriptions is taking the retailer closer to Amazon’s turf. It will be harder to shine in this territory.
Reckitt baby food is problem child best kept home 17 Feb 2022 Offloading the sluggish Enfamil unit would boost the Nurofen maker’s growth. But rivals Nestlé or Abbott would face regulatory hurdles, while a buyout group would probably pay less than the unit’s 5.4 bln pound book value. CEO Laxman Narasimhan is better off holding on.
Capital Calls: Continental split 17 Feb 2022 Concise views on global finance: The $20 bln German auto supplier is eyeing a four-way separation, according to a report.
Paramount’s streaming revamp is an uphill struggle 16 Feb 2022 ViacomCBS is rebranding to emphasize the media group’s Paramount+ service, which has 33 mln subscribers. Content costs are ballooning just as investors grow skittish about leader Netflix’s growth. A 20% share price drop on Wednesday widens the valuation gap with larger rivals.
Rich stocks have yet to feel cost-of-living crisis 16 Feb 2022 Rising inflation and higher energy bills are hitting consumers. UK punters in particular look vulnerable, given uneven savings and tax hikes. Mass belt-tightening could mean fewer holidays and less spending on luxuries like streaming, hurting companies from Ryanair to BT.
The Exchange: Consumers have the retail whip hand 15 Feb 2022 From Saks Fifth Avenue to Target, U.S. retailers are under intense pressure to change their businesses to meet consumers’ needs. Alix Partners’ Joel Bines tells Jennifer Saba it’s about more than just a shift in shopping habits. He argues that consumers now hold all the power.
Capital Calls: Crypto hangs up Super Bowl placard 11 Feb 2022 Concise views on global finance: Cryptocurrency firms have lined up for ads on the U.S. football championship, much like dotcoms did in 2000. They are paying up to $7 mln per spot, or twice as much, adjusted for inflation.
Viewsroom: Spotify, Peloton and failed chip deals 10 Feb 2022 Neil Young’s podcast protests have shone a light on a potential flaw in Spotify’s business model, says Liam Proud. Peloton highlights the danger of giving company founders too much voting power, Rob Cyran argues. And semiconductor M&A gives global antitrust regulators agita.
Capital Calls: ABB’s car chargers, Airport M&A 10 Feb 2022 Concise views on global finance: The Swiss engineering group’s listing plans come at an unfortunate moment; Britain’s John Menzies takes a risk with rejection of “opportunistic” approach from Kuwaiti air services group NAS.
Unilever’s Plan B invites unflattering comparisons 10 Feb 2022 After a failed 50 bln pound bid for GSK’s consumer arm, CEO Alan Jope intends to focus on more promising brands in personal care and beauty. That unit’s revenue grew 4% last year, lagging glossier rivals like L’Oréal. Higher sales will also come at the expense of lower margins.
Yum China’s strategic recipe adds too much spice 10 Feb 2022 The KFC and Pizza Hut owner plans to open as many as 1,200 new stores across the country despite a 93% fall in quarterly profit. Starbucks is similarly confident. Both may be underestimating the extent of consumer weakness. Hotpot chain Haidilao provides a cautionary tale.