Retail

Li Ning’s sprint easily confused for a marathon

19 September 2019

The $7 bln Chinese sportswear maker’s shares have nearly tripled this year and now fetch a higher valuation multiple than Nike, Adidas and Anta. A new co-CEO from Uniqlo may help build on the turnaround. Fierce competition and an economic slowdown, however, will slow the pace.

Yahoo Japan pushes Zozo investors into new orbit

12 September 2019

The SoftBank-backed web portal offered $3.7 bln for control of the ailing fashion site. Zozo’s boss, who bought SpaceX’s first ticket to the moon, is tendering most of his stake. Other owners may want to sell too: Yahoo Japan recently trampled on minority shareholders elsewhere.

Inditex high street reign comes with higher bar

11 September 2019

The Zara owner’s strong first-half sales growth was overshadowed by downward pressure on its gross and operating margin in the second quarter. Investors’ concern about the cost of growing revenue may be valid but a widening valuation discount to peer H&M seems harsh.

Tapestry’s luxury conglomerate dream unravels

4 September 2019

The owner of handbag maker Coach has replaced CEO Victor Luis, under whom the shares halved. Its Kate Spade brand is performing poorly, while Coach is more solid but lacks rivals’ cachet. Turning round a luxury brand is tough, but turning around a conglomerate is even harder.

Chinese consumers are deceptively perky

4 September 2019

Sales of athletic gear, appliances and such have kept growing at 7-10% in defiance of economic headwinds blowing more strongly. Tax cuts and rising property values are helping. Without such support, the likes of Tiffany, Haier and Yum China are likely to feel the slowdown’s pinch.

Walmart edges onto right side of gun debate

3 September 2019

The U.S. retailer already stopped selling assault-style weapons – now it won’t sell ammo for them either. That won’t end gun violence, but doing so isn’t really Walmart’s responsibility. More decisive moves would have to come from government, which looks even more out of touch.

Hong Kong’s jittery shoppers are a bad omen

30 August 2019

Anti-government protests dragged retail sales down 11.4% in July. It’s an early measure of what unrest will cost an economy already on the edge of recession. After past crises like SARS, consumption recovered swiftly; a cooling China and other factors suggest this pain will last.

Uniqlo owner’s luxury premium merits a rethink

30 August 2019

A South Korean boycott of Japanese goods has hurt Fast Retailing. It's another foreign snag for the $63 bln seller of cheap cashmere. Boss Tadashi Yanai needs shoppers abroad, given weakness at home; setbacks leave its valuation, racing ahead of Zara owner Inditex, looking rich.

U.S. retail can get better before it gets worse

22 August 2019

Big store chains are bucking the gloom, some thanks to their former inefficiency. Nordstrom is cutting stock, J.C. Penney is slashing costs and Target’s bid to compete with Amazon is starting to take effect. That creates room for pleasant surprises – if only in the short term.

Walmart adds solar burns to Tesla’s challenges

21 August 2019

The U.S. retailing giant is suing Elon Musk’s $40 bln electric-car maker for negligence after its solar panels allegedly sparked fires at stores, further denting Tesla’s quality-control image. Walmart’s move also puts Musk’s odd 2016 acquisition of SolarCity back in the spotlight.

Walmart proves it’s a port in gathering storm

15 August 2019

Strong sales last quarter, especially in e-commerce, allowed the $300 bln giant to sail past growing headwinds battering retail rivals. It may even be able to withstand more Trump tariffs. And in a broader downturn, CEO Doug McMillon could pick up more price-conscious shoppers.

Aramco stocks Reliance’s war chest for disruption

12 August 2019

Mukesh Ambani says the Saudi giant will buy 20% of his oil-to-chemicals unit at a healthy $75 bln valuation. The billionaire is adding cheap broadband to a revolutionary telecoms offering, and aims to reinvent Indian retail too. The Aramco sale hints at how far he'll go to win.

Asia sale can give Aviva revamp a timely boost

8 August 2019

The UK insurer is reviewing its future in the east. New boss Maurice Tulloch wants to cut costs and debt. Selling the subscale division, worth as much as $4 bln, is a step in the right direction. Local firms like FWD are keen to consolidate, which should guarantee a good price.

Victor Li is a half mark up on Hong Kong’s tycoons

1 August 2019

Political unrest is a threat to top conglomerates with a big focus on the Fragrant Harbour. Earnings at Li’s CK Hutchison put a spotlight on the group’s shift away from the territory. Global growth is slowing and currencies are volatile, but a diversified bet still looks better.

EssilorLuxottica M&A invites sharp antitrust lens

31 July 2019

The $58 billion eyewear giant’s merger was waived through last year by regulators. But its purchase of Dutch optical retailer GrandVision risks curbing competition. It could promise to permit opticians to offer rivals’ products or sell some shops to a peer to help allay concerns.

Hong Kong demonstrators risk muddling the message

19 July 2019

As the city's tycoons will attest, scale comes at a cost. Protests first focused on extraditions to the mainland, but as the leaderless movement has grown, so too have flare-ups around issues like border traders. That is hitting business; it may also squander a chance for change.

Richemont’s jewels overcome slower watches

18 July 2019

Protests in Hong Kong did enough damage to merit a mention as sales of timepieces, the 40 billion euro luxury group’s No.2 category, fell in the quarter to June. But jewellery and online channels helped produce 9% top-line growth, underlining the Swiss group's robust portfolio.

Amazon could be a smart shopper in Southeast Asia

8 July 2019

The U.S. e-commerce giant pushed into Singapore in 2017, but hasn’t tackled the region's larger, faster-growing markets. Indonesia’s $7 bln Tokopedia and Alibaba-owned Lazada are among those scrapping for dominance. Amazon would be a formidable rival if it bought Sea's Shopee.

Muji wannabe’s $1 bln IPO tests power of mimicry

5 July 2019

Miniso, brash Chinese rival of the minimalist chain, is considering a listing. The Tencent-backed seller of toys and gadgets cultivates a Japanese feel. The challenge will be to convince investors that its valuation belongs with slick Tokyo peers, not pile-em-high 100-yen shops.

Sainsbury’s stagnation adds pressure for new plan

3 July 2019

The UK retailer’s sales fell for the third quarter in a row. After the failed merger with Asda, CEO Mike Coupe has cut prices and invested in stores. But his strategy is not bearing fruit, and a chaotic Brexit could further hurt. Coupe needs to come up with a bolder strategy.