Despite the pandemic, the company will open 655 new stores in 2020, which is not on record in Fix Price’s history. This year, the retailer plans to open 750 stores already, reaching a rate of 800 new stores a year by 2023.
Dividend pricing shows relative
Despite high growth rates, the company has committed to paying at least 50% of net income in dividends. Thus, based on the results of the last three years, the total dividend payout was 53 billion rubles, which in 2020 was fixed at the level of 32.6 billion rubles, accounting for 73% of Fix Price’s net profit.
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about competitors . In 2019, Fix Price had a 93% share of Russia’s low-price goods market, compared with 5% for its closest competitor, Home Market, according to Oliver Wyman. According to Rosstat, the total Russian retail market reached US$518 billion in 2019, with an average annual growth rate of 5%.
as a similar product
Pioneering, Fix Price had undeniable advantages over its competitors, which initially placed considerable barriers to entry in the market, including unique prices and national coverage for buyers, as well as brand equity.
According to Oliver Woman, Fix Price’s revenue could reach 1.8 trillion rubles by 2027, compared to 1.2 trillion rubles in 2019. The average annual growth rate will be 7%, and according to analysts, the growth rate of the Russian retail market between 2020 and 2027 will be twice as low.
coverage of online transactions, exchange rate fluctuations of the national currency of the Russian Federation against the Chinese yuan and the US dollar, and reliance on rent.
According to Valery Emelyanov, an analyst representing Freedom Finance, the fixed price estimate is quite high. As an example, the expert cites the Magnit network, which is valued at $6.5 billion, while Fix Price earns rout from CU Leads to . To justify this difference, the discounter business would have to steadily double over the course of several years. A natural question arises,
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Given that investors are already showing increased interest in new market players, Fix Price stock can gain a lot in price in the first few days. However, because many private investors cannot participate in the IPO, they will not be able to take advantage of the growth of the retailer’s securities on the first day of trading. Analyst Viktor Argonov representing EXANTE said that despite the current surge in interest in placements of the company’s securities, the future of Fix Price shares remained in doubt.