Japan PPI inflation slips to 11-mth low in July
Investing.com -- Delivery Hero AG (ETR:DHER) shares jumped around 6% on Friday after UBS flagged an increase in Baemin’s market share performance in June.
Baemin, the South Korean food delivery platform in which Delivery Hero bought a controlling stake for $4 billion in 2019, gained 1.3 percentage points month-over-month in June, reaching approximately 60% of the country’s market.
This marks Baemin’s first share increase since January and follows nearly 7 percentage points of cumulative losses between February and May.
UBS views Baemin’s market share rebound as an early indication that Delivery Hero’s efforts in Korea may be gaining traction.
The analysts noted that Baemin’s underperformance has weighed on the stock but called the June improvement “a step in the right direction.” They added that it could be “a promising sign that DHER’s investments are coming/will continue to come to fruition.”
Despite the June recovery, UBS does not expect Baemin to return to absolute growth before the fourth quarter, citing “tough comps and the rollout of initiatives coming to fruition throughout the year.”
The bank continues to forecast Korean GMV to decline 6.5% on a constant-currency basis for full-year 2025.
While competition in Korea remains intense, UBS noted the broader food delivery market continues to expand, with official data showing +14.2% year-over-year growth in May.
It also flagged concern about a potential overhang from Prosus’s ~28% stake in Delivery Hero, following regulatory scrutiny from the European Commission.
Bloomberg recently reported that Prosus (OTC:PROSF) may be under pressure to reduce or divest its holding, which weighed on Delivery Hero shares.
While no formal decision has been made, UBS highlighted investor concerns around a potential sale, especially amid broader questions about Prosus’s strategic direction in the sector.
UBS maintained its “Buy” rating on the stock, though it trimmed the price target to €38 from €39, implying 73% upside from the last close.
“We see DHER’s accelerating GMV profile coupled with ongoing improving profitability and free cash flow (FCF) profile as encouraging,” the analysts said.