World cup opportunity

WITH the stage long set for the World Cup in Russia, investors and analysts have factored in the potential benefits for brewers, retailers and advertisers. So what opportunities remain?

For betting and pub companies, match results in the month-long competition are likely to influence performance. While bookmakers would benefit from a run of upsets and tied games, too many victories for favoured teams such as Brazil would be a setback.

The longer England stays in, the better for British bar operators. Should Australia surprise, expect a boost for Domino’s Pizza Enterprises. And the winning team’s uniform supplier would probably also benefit.

BREWERS, BOOKMAKERS, FOOTBALL GEAR MANUFACTURERS SET TO RAKE IN PROFITS

“The winners are typically well established, with supporters more inclined to visit pubs for big games or play host at home, driving up sales of big-screen TVS and alcohol,” said Joshua Mahony, a market analyst at IG in London.

The tournament will provide fertile ground for bookmakers. The volume of bets placed is set to soar, with smartphone apps making betting easier than ever.

By contrast, the World Cup could be negative for industries like casinos that lose when gamblers’ attention and money shift elsewhere.

The maker of the winning team’s uniform can expect a short-term boost from sales of replica shirts. At the World Cup in 2014, adidas sold more than 8 million jerseys, including 2 million in the colours of winner Germany.

In Russia, adidas is sponsoring 12 of the 32 teams, including powerhouses Argentina, Spain and Germany, with arch-rival Nike supplying 10 teams, including Brazil, Portugal and France.

Sporting-goods retailers can also anticipate a sales jump as the tournament stokes demand for gear.

Jpmorgan Chase & Co expects Twitter to benefit after the company partnered with Fox Sports to show highlights in almost real time. This year’s tournament could be a much larger deal for Twitter than in 2014, when the event contributed about $24 million of revenue in the second quarter, according to MKM Partners analyst Rob Sanderson.

Fifa video game-maker Electronic Arts could be another winner. Bloomberg Intelligence’s Matthew Kanterman wrote last month that he expected EA’S forecast to “prove conservative amid robust growth of live services like Fifa Ultimate Team”.

RHB Research Institute analyst Juliana Cai expected the event to stimulate alcoholic beverage consumption. – Bloomberg