Ocado joins FTSE 100 after international partnerships

OCADO is set to be catapulted into the FTSE 100 for the first time after a string of high-profile international deals led to its shares soaring.

The online grocer recently secured a deal with US giant Kroger, which resulted in its share price rising by more than 40 per cent.

Now, Ocado looks set to be promoted when a reshuffle of the FTSE 100 takes place on Wednesday. Laith Khalaf, senior analyst at Hargreaves Lansdown, said: “Ocado has for some time been a popular stock for hedge funds to bet against, but now just 5 per cent of the company’s shares are in the hands of the short sellers compared to 13.5 per cent in January.”

Shares in the group have rocketed from around 314p to 880p in the space of 12 months. Ocado has signed a string of similar agreements in Europe and beyond and is developing customer fulfilment centres with retailers in France, Canada and Sweden. In the UK, Ocado works with Morrisons.

Anne Marie Neatham, chief operating officer of Ocado Technology, joined the company 16 years ago and has seen the firm’s technology arm grow from a workforce of 350 to over 1,200. She said the international deals work well for Ocado because the company does not need to understand foreign markets intimately to be able to do business there.

The retailers partnering with Ocado know their home markets inside-out, and Ocado provides the technology to allow them to take their services online, she said.