Ocado Share Price (OCDO)

He confirmed what I thought about the South Korea Lotte deal. SK has the highest online grocery market penetration at close to 30%. Lotte selected Ocado for 6 CFCs and they are a company with a strong background in automation in a country with a lot of highly advanced tech already in place.

Interesting contrast with Japan where online penetration is much lower at around 3%. Can Ocado's partnership with Aeon Next there help to increase online market share? You would think some of Japan's densely populated areas would be ideal for the Ocado delivery model.

As for Autostore they are focused on deploying their tech in smaller fulfilment centres with a much broader spread of sectors. Thanks to the investment in the Reimagined tech, Ocado can now position themselves as direct competitors to them in industries such as consumer packaged goods and pharmaceuticals. The Reimagined kit has brought down the cost and it's modular nature means it can be deployed with greater flexibility.

Off the top of my head it was only about 7-8 years ago that Ocado really turned their attention to selling systems to other grocery. They are projecting revenue from Solutions of about £500m for 2024. If they can increase that to £1bn or more over the next couple of years then the EBITDA contribution will increase greatly. Logistics is not expected to grow and Retail will be unlikely to deliver a margin of much more than 5%.

As Bernstein's William Woods said on the video the market seems incapable of valuing Ocado given the wild fluctuations in the SP. I think the current malaise is down to a mix of things like shorts betting that negative press can generate a death spiral down, the lacklustre UK market that has seen a number of companies either get bought out or opt to list in the US.

Obviously my optimism could be greatly misplaced. For all I know the OIA sales team could be running round like headless chickens with no strong strategic direction. Or they really have already reached the peak in terms of finding international grocery groups willing to sign up to the CFC model.

"Ocado is worth far more than the current SP"

...and when they relist on the NASDAQ they will be.

Https://www.bbc.co.uk/news/business-68639533.amp

Very impressive.

Ocado is worth far more than the current SP.

Short sellers have savaged the SP.

Following your prompt, Sang , I’ve now watched the video - which is 6 months old and made when the sp was, er, rather more than today!! So his advice turned out to be cr+p (although it did nearly hit 800 and I recall taking profits).

Yes - he says Tech is the thing for OCDO investors but look at it - is that really true regarding the company? It’s been pumping cash into UK CFCs and Logistics etc. etc and is now in the top three UK online grocers It’s primarily an f’in grocer ffs!!! And, despite being in the top three it is still making a loss every year - so something isn’t right - right?

The FY Report had Solutions at less than a third of group EBITDA - with Logistics dominating (thanks to people and vans) and Retail limping along due to the poor margins in grocery.

Autostore seem to have more focus on tech although they've admittedly not been as smart as OCDO in selling a product that provides a sustainable income stream.

OCDO tech has had more than a decade since IPO and a decade before that, so twenty years + , which is a long time in tech, but it still isn’t a global benchmark warehouse system. Is that because the UK grocery business was the priority?

I hope Steiner has a tough time at the AGM: after twenty + years building a top three UK on-line business and an advanced tech product he's still making a loss. I doubt he would even make it on The Apprentice. And he wants a bonus? LMAO.

A move to the NASDAQ needed for the tech side to be valued. It will happen.