IPO hangover, inflation heats up demand for thrift stores and what matters in the market

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Stock market newbies in red

of the 85 companies that went public (IPO) on the Brazilian stock exchange since 2015, only 11 of them (13%) had a return above the Ibovespa.

The analysis is from the TradeMap financial data platform and comprises the period between the IPO of each company and July 15, 2022.

In numbers: among the successful newcomers, Movida (light vehicles) and Vamos (trucks and machines) rent a car, with profitability of 90.50% and 70.31% since the IPO, respectively.

• At the other end, the negative highlight is for companies linked to consumption. C&A shares plummeted about 85% since the IPO, while those of Enjoei have sunk 88% since its debut on the Stock Exchange.

What explains: companies that have shown positive profitability since the IPO are mostly linked to sectors that have appreciated in the face of the consequences of the pandemic or the war in Ukraine.

• The first case includes car rental companies, whose prices rose in the face of a supply shock generated by the semiconductor chip crisis.

• The second deals with fuel companies, such as PetroReconcavo, Vibra and 3R Petroleum, which followed the rise in oil prices.

• At the lower end, companies that are more sensitive to inflation, interest rates and the performance of the domestic economy suffer more amid the longest monetary tightening in the historical series.

More about investments:

• The meat disappeared from the plate of Brazilians, but the scenario of high exports and pressured prices may be favorable for the shares of meatpackers on the stock exchange. Understand in Marcos de Vasconcellos’ column.

time for thrift stores

Faced with the highest inflation in clothing since 1995, the demand for second-hand items from thrift stores continues to increase.

In the next five years this market should grow from 15% to 20% per year and surpass the fast fashion sector (from brands like Zara, Shein and H&M) by 2030, according to US researchers.

In numbers: while the inflation of the clothing sector, measured by the IPCA, reached 16.08% In the 12 months ended in May, ACSP (São Paulo Commercial Association) projects growth of 29.6% in the sales volume of thrift stores in 2022.

• Local companies also look to the size of the sector abroad to project an expansion here. In the US, the used clothing market moved $36 billion in 2020 (R$ 187.7 billion, at the current price).

• Here, the projection is of a potential for BRL 24 billion for the used fashion market, according to a survey by BCG (Boston Consulting Group) with almost 3,000 Enjoei customers.

What explains the growth? There are consumer concerns about sustainability and a call for “vintage” pieces, but above all there is the pocket: almost 40% of respondents in the BCG study are less fashion-conscious and love bargains.

More on the impact of inflation on consumption habits:

Price is an impediment for most Brazilians to support small brands, and only 32% are willing to pay more for local products, according to a NielsenIQ study.

Amazon Expands Home Items With Robot Vacuum Cleaner

Amazon announced last Friday (5) the purchase of iRobot, the robot-vacuum cleaner Roomba, for US$ 1.7 billion (R$ 8.8 billion), in an expansion of the company’s portfolio of products for homes.

In numbers: Amazon’s proposal of US$ 61 per share (R$ 317.81) is 22% above the closing price of the company’s shares on Thursday (4).

The strategy: the robot-vacuum cleaner joins the Alexa virtual assistant and the Ring electronic doorbell in the company’s list of products for automated homes.

jackpot: iRobot’s acquisition is the fourth largest in Amazon’s history. This year, it’s behind the $3.9 billion (R$ 20.3 billion) spent last month to buy One Medical, of health services.

• The company still paid US$ 13.7 billion (R$ 71.4 billion) in 2017 to buy Whole Foods, an organic food company, and announced last year the acquisition of the MGM studio for US$ 8.45 billion (R$ 44 billion)

Startup of the Week: dr.consulta

The “Startup of the Week” board brings on Mondays the x-ray of a startup that recently received funding.

The startup: founded in 2011, dr.consulta is one of the pioneers in the healthtech sector (health startups).

• It has a network of medical centers with a focus on primary and secondary care and is taking its first steps in the health insurance segment after acquiring part ofcuidado.me at the end of last year.

In numbers: the startup announced last Monday (1st) a contribution of BRL 170 million in a series D round (understand the stages of investing in startups here). The company now accumulates US$ 144.5 million (R$ 753.7 million) in investments.

Investors: the investment was led by the manager Kamaroopin and also had participation from the Madrone Capital and Lightrock funds.

What problem does it solve: the startup promises to facilitate and democratize access to healthcare in the country, with online appointment scheduling and exams. She also went on to offer hospital care after her deal withcuidado.me.

Why it’s featured: in addition to registering the highest uptake of the previous week, dr.consulta is part of the movement to renew health plans driven by startups.

• With this investment, dr.consulta is capitalizing to compete in this segment with competing startups Sami and Alice, which announced funding at the end of last year.

The week at a glance

• There were eight fundraising rounds in Latin America, with $87 million (R$453.7 million) in investments. Brazil concentrated three of them – the others took place in Mexico, Argentina and Uruguay.

• In the month of July, the volume raised in the region (US$ 845 million) was 15% higher than June. The month also marked the highest number of mergers and acquisitions (36) so far in the year.

Data is provided by the Sling Hub platform.