Ocado needs more deals and less egg on face

Alright, full disclosure, Ocado was my share tip for 2023 at the start of the year. I had hoped that positive investor sentiment towards a pipeline of logistics tech deals with retailers all over the world would more than offset the difficult consumer landscape back home.

How wrong I was. The shares shed another 10% of their value this morning and are now down almost 14% since my recommendation.

Today’s data from Kantar suggests that 2023 will be another difficult slog. A world in which food inflation is blazing at 17.1% can only be good for the Aldis and Lidls of this world — but terrible for the Ocados.

The return to pre-Covid shopping patterns has also hurt the company, with the days when the shares raced to £20 and beyond during the lockdown era just a distant memory. It is more than 20 years since Tim Steiner and his Goldman Sachs pals Jason Gissing,

Jonathan Faiman revolutionised grocery shopping with a vast hi-tech warehouse in Hatfield and a perky fleet of delivery vans. While those vans have done wonders for house prices in the aspirational London “Ocado-belt”, shareholders have been less fortunate: a £500 million loss in particular will be hard to forgive.

This surely has to be the year when the much vaunted Ocado Smart Platform starts to be rolled out at pace. A dozen deals have been signed so far but without an acceleration 2023 is going to end with a botched delivery: no jam once again for shareholders, but plenty of egg on face for me.