Ah, I understand. Personally, I don't think e-Grocery will be revolutionary for them - they estimate the Kazakh grocery market to be worth $14b. Say 40% of that is in cities big enough for e-grocery to make sense, then within those cities they can capture a very optimistic 50% market share (of all groceries, not just e-groceries). Becaus…
Ah, I understand. Personally, I don't think e-Grocery will be revolutionary for them - they estimate the Kazakh grocery market to be worth $14b. Say 40% of that is in cities big enough for e-grocery to make sense, then within those cities they can capture a very optimistic 50% market share (of all groceries, not just e-groceries). Because groceries are a pretty low margin product, say the profit in total on that is 10%. Then assume profit is split 50:50 between Kaspi and Magnum. Multiply all those rather optimistic numbers together and you get $140m in profit - only about 7% of Kaspi's current run-rate profit. But let me know if your maths looks different.
I agree, even if they capture a big percentage of the market, it will remain a smaller part of total revenue and profits. The idea is that they have this capability of launching new services that quickly grow so there's a sense of unknown optionality to their superapp business model.
Ah, I understand. Personally, I don't think e-Grocery will be revolutionary for them - they estimate the Kazakh grocery market to be worth $14b. Say 40% of that is in cities big enough for e-grocery to make sense, then within those cities they can capture a very optimistic 50% market share (of all groceries, not just e-groceries). Because groceries are a pretty low margin product, say the profit in total on that is 10%. Then assume profit is split 50:50 between Kaspi and Magnum. Multiply all those rather optimistic numbers together and you get $140m in profit - only about 7% of Kaspi's current run-rate profit. But let me know if your maths looks different.
I agree, even if they capture a big percentage of the market, it will remain a smaller part of total revenue and profits. The idea is that they have this capability of launching new services that quickly grow so there's a sense of unknown optionality to their superapp business model.