Frasers Group bolsters investments in ASOS and Boohoo

Frasers Group (LSE: FRAS), the retail powerhouse led by tycoon Mike Ashley, has increased its stakes in online clothing companies ASOS and Boohoo Group. According to filings made public on Monday, Frasers Group has elevated its holdings in Asos to 22.8% from 19.7%, and concurrently upped its stake in Boohoo to 15.1% from 13.4%.

The move comes at a time when both ASOS and Boohoo have faced challenges in the stock market, experiencing notable declines in their share prices over the past year. ASOS shares plummeted by 26%, while Boohoo witnessed a 23% dip, making them potentially lucrative options for investors seeking undervalued assets.

Analysts speculate that Frasers Group’s decision to increase its stakes in these companies is a strategic manoeuvre, leveraging the reduced valuations as an opportune moment for expansion. Both ASOS and Boohoo, despite recent market challenges, continue to maintain robust positions in the online retail sector, buoyed by their resilient business models and global customer bases.

As of midday on Monday, ASOS (LSE: ASC) showed signs of a modest recovery, with its shares rising by 1.9% to 386.80 pence. Boohoo (LSE: BOO) also demonstrated an uptick, climbing by 1.6% to 30.00p. In contrast, Frasers Group’s shares remained stable at 801.00p.