Jumia was an interesting stock back in 2020/2021, seemed like everyone was talking about it in the bull market. After seeing success stories like Mercado Libre and Sea Limited I couldn’t help but buy a few shares of Jumia around $20. The problem is that you sort of have to believe in the African growth story for the thesis to work out long term.
It seems like Africa lacks the infrastructure to handle logistics, like there are not even street addresses in some areas of Africa. Many countries have weaker financial institutions including a large unbanked population without checking accounts. And the internet penetration rates can be really low in some countries.
I feel like at certain inflection point of development in emerging markets there will most likely not be a country or region that will be an exception to increasing e-commerce adoption. But even though Jumia as a first mover advantage, I’m not sure if they’ll be the company to revolutionize e-commerce in Africa if wide e-commerce adoption is even possible in Africa at the moment.
Do we think that the bull thesis is still intact for Jumia. Or is it a sell?
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