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Buying Opportunities In The Internet Industry With Huge Discounts

Apr. 13, 2018 12:45 PM ETNaspers Limited (NPSNY)AMZN, SFTBY, WMT, TCEHY, TCTZF, FPKT33 Comments
Abelardo Fraga profile picture
Abelardo Fraga


  • E-commerce and online businesses continue to soar in emerging markets creating great opportunities to invest.
  • Global players are targeting emerging market internet businesses seeking to expand their activities in fast-growing economies.
  • Buying Naspers Ltd. is a great idea for long-term investors willing to have exposure to the internet industry and exposure to growth opportunities in China, India, and Brazil.
  • Buying Naspers means buying Tencent at a huge discount, receiving for free other Naspers' operations.

Internet Businesses in Emerging Markets

E-commerce and online businesses continue to soar in emerging markets and various global e-commerce studies indicate that we can expect to see further growth in online transactions worldwide. The main driver for e-commerce growth in developing markets has been the rise in internet access and the use of smartphones. Other factors propelling online retail are expanding incomes, which are resulting in a larger emerging middle-class shopping online for products and services.

More than half of the world's internet users are now in Asia. The majority of the global middle class is in emerging markets (EM) and nearly 90% of the next billion entrants will come from Asia, according to the Brookings Institute (The unprecedented expansion of the global middle class).

The overall annual online retail sales across the biggest emerging markets, which included among others, China, Brazil, India, Mexico, South Africa, Russia, Saudi Arabia, and Turkey - could reach more than 2 trillion US dollars until 2019.

There are many reasons for investors to be excited about emerging markets today. Yet it remains true that these markets can be difficult to enter as an individual investor:

  • returns on investment are more volatile than in developed markets;
  • understanding market fundamentals is challenging due to faster shifts in consumer preferences and in regulatory and policy patterns.

My purpose in this article is to present a company with a long record of very successful capital allocation, Naspers Ltd. (OTCPK:NPSNY). I think that buying Naspers can be a well-diversified bet in different internet businesses across many countries in emerging markets.

About Naspers

Founded in 1915, Naspers is a global internet and entertainment group and one of the largest technology investors in the world. The company is headquartered in Cape Town, South Africa and operates in over 120 countries. For more than 100

This article was written by

Abelardo Fraga profile picture
Long term investor. Growth at a reasonable price (GARP) investor. Information Technology, Biotechnology, and Emerging Markets investor.

Analyst’s Disclosure: I am/we are long NPSNY. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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