Ocado has long battled for profits as they position themselves as a tech company who works in the food retail sector. With demand for online shopping going stratospheric during lockdown under Covid-19, Ocado appears to be a big winner.
Since launching in 2000, Ocado have been pioneers in online shopping facilitation, aiming to “change the way the world shops”. As with many tech firms, capitalising on profits has frequently been out of reach, especially after a disastrous fire in 2019 which destroyed their Andover warehouse, resulting in exceptional charges of £94.1million in their 2019 accounts.
Despite the fire, Ocado shares increased 31 per cent in value during 2019, reaching an £8.6billion stock valuation, meaning their share price has more than trebled over the previous five years. The value of the online shopping platform is also continuing to soar in 2020.
Since the beginning of the year, Ocado’s stock value has rocketed 46 per cent to £13.1billion, valuing the business at more than Morrisons, Sainsburys and M&S combined. Tesco remain clearly ahead with a value of 23.2billion, while Wal-Mart owned Asda, the second largest retailer by market share, is not listed on the UK stock exchange.
Morrisons, Sainsburys and M&S have all seen their market value fall this year, with M&S being the biggest loser with a 56 per cent drop. Ocado provides the technology behind Morrisons online delivery service, which suggests Ocado could continue to become a growing force behind the scenes of UK food retail.