Morrisons joins forces with Deliveroo to handle order capacity amid Covid-19
The UK supermarket chain saw its shares close higher on Wednesday after announcing it is partnering with the food delivery service provider to help boost order capacity during the coronavirus pandemic.
Morrisons has partnered with Deliveroo amid the Covid-19 pandemic in a bid to improve its delivery capacity and cope with the rise in demand due to the government-imposed lockdown.
Customers can order from a selection of 70 essential items from 130 Morrisons supermarkets across the UK using the Deliveroo app.
‘Our partnership with Deliveroo will help us to continue to play our full part in feeding the nation,’ Morrisons CEO David Potts said. ‘Customers will be able to order essential products from Morrisons biked by Deliveroo to the door in as little as under 30 minutes.’
‘It’s a great combination of traditional and modern methods and it will provide more vulnerable people with the opportunity to receive their home delivery,’ he added.
Morrisons partnership with Deliveroo will last until the lockdown ends, the company said, but the UK government is unclear when that exact date will be.
‘With families and vulnerable people in isolation, it is more important than ever that we make sure they have access to the essential household items they need,’ Deliveroo vice president of new business, Ajay Lakhwani, said.
‘During this worrying period we want to play our role in making sure people have access to a range of items, in particular the vulnerable who cannot leave their homes,’ he added.
Morrisons shares rise after Deliveroo partnership
After announcing the partnership, shares in Morrison climbed higher on Wednesday, closing at 178p a share.
Shares in Morrison peaked at 199p a share in mid-March this year, with investors anticipating stronger sales due to panic buying as consumers are forced to stay home amid the viral outbreak.
However, those gains have largely been eroded as investors and analysts realise that panic buying is a double-edged sword. On Wednesday, Tesco admitted that despite experiencing a surge in sales, it could end up paying up to £925 million in higher recruitment and distribution costs in order to meet demand.
‘Growth is only really relevant if it is profitable and the 30% surge in sales in recent weeks may have been more of a headache than the boost it might superficially have appeared to be,’ Russ Mould, investment director at AJ Bell said in a note.
Morrisons is trading at 180p a share as of 12:45 (GMT) on Thursday.
How to trade retail stocks with IG
Create an IG Trading Account or log in to your existing account
Enter ‘Morrisons’ or any other stock in the search bar and select it
Choose your position size
Click on ‘buy’ or ‘sell’ in the deal ticket
Confirm the trade
Reports suggested that Deliveroo planned to conduct its IPO in early 2020. However, the company will likely postpone the IPO until the coronavirus outbreak ends.
But when the company does give an official date, investors can trade the Deliveroo IPO with IG after the listing.
After the IPO
Once Deliveroo has listed, you will be able to go long or short on Deliveroo by CFD trading
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
React to global volatility
Market volatility continues as coronavirus dominates the global agenda. Trade with us to take advantage of:
- Tight spreads – from just 1 point on major indices, and 2.8 on US crude
- Guaranteed stops – they’re free to use, and you’ll only pay a small fee if they’re triggered
- Round-the-clock assistance – our highly-skilled team are on hand to support you
Live prices on most popular markets