Major retailers have reported a loss of $382bn in their cumulative market capitalisation (MCap) in the first quarter (Q1) of 2022, according to leading data and analytics company GlobalData.
GlobalData reported that the top 25 global retailers by MCap saw losses due to rising inflation and the Russian-Ukraine war, which has impacted the consumption recovery.
Among the top 25 retailers, six companies have suffered a loss of more than $25bn in their valuation during this period.
These six firms are Amazon, Alibaba, Home Depot, NIKE, Lowe’s and Inditex.
In addition, US-based improvement retailer Home Depot recorded the highest loss in valuation, at more than $100bn, in Q1 2022.
The implementation of the Holding Foreign Companies Accountable Act (HFCAA) in China has added another burden to the country’s online retailers, which include Alibaba, Pinduoduo and JD.com.
Changes to the regulatory environment due to the HFCAA’s implementation have caused investors to reconsider investing in these companies’ stocks.
At the same time, food retailers such as Seven & i and Kroger registered growth of more than 20% in MCap during the quarter.
Japanese retail group Seven & i attracted and retained investors’ interest through its continued investment in digitalisation and focus on sustainable growth.
Investors were driven to Kroger’s stocks by its positive performance in Q4 2021 and its focus on digital development to manage supply-chain challenges.
GlobalData business fundamentals analyst Keshav Kumar Jha said: “(Retailers’) businesses tend to be vulnerable to increasing inflation, as it could jeopardise the consumption recovery that began to improve following the pandemic in 2020.
“Companies have been impacted by the recent geopolitical tensions due to the Russia-Ukraine war, which has caused oil and energy prices to soar, adding to the already increasing inflationary pressure.”