Excelling writeup JP. With respect to vmoto, what do you think the moat is? Generally, manufacturing is a capital intensive low margin business. How can they sustain themselves against well capitalised behemoths with almost every 2 wheeler manufacturer getting into electric now?
Thanks for the comment. I think what you've highlighted here has always been the achilles heel of Vmoto. I've worried for them about competitors entering the market. I remember reading quite a while back about Vespa kick-off production of the Vespa Elettrica.
If there is a moat for Vmoto, I think it may be in their deeply engrained relationships with their B2B customers. These customers make a large part of their business and likely get very favourable buying conditions.
In any case, there's no escaping low margins which you mention.
I suppose the counter argument here is that current valuations are not pricing in a whole lot of growth. If they can prove a return to growth (recent quarterly was negative), then shareholders may be well positioned.
Hoping this helps, thanks for the comment again mate!
Excelling writeup JP. With respect to vmoto, what do you think the moat is? Generally, manufacturing is a capital intensive low margin business. How can they sustain themselves against well capitalised behemoths with almost every 2 wheeler manufacturer getting into electric now?
Hey mate,
Thanks for the comment. I think what you've highlighted here has always been the achilles heel of Vmoto. I've worried for them about competitors entering the market. I remember reading quite a while back about Vespa kick-off production of the Vespa Elettrica.
If there is a moat for Vmoto, I think it may be in their deeply engrained relationships with their B2B customers. These customers make a large part of their business and likely get very favourable buying conditions.
In any case, there's no escaping low margins which you mention.
I suppose the counter argument here is that current valuations are not pricing in a whole lot of growth. If they can prove a return to growth (recent quarterly was negative), then shareholders may be well positioned.
Hoping this helps, thanks for the comment again mate!