Naspers Limited: Riding the Wave of Ecommerce Dominance and Shareholder Returns

The global ecommerce landscape is undergoing a seismic shift, with companies racing to leverage AI, consolidate markets, and deliver value to shareholders. Few firms exemplify this transformation better than Naspers Limited, the South African multinational tech conglomerate. With 21% year-on-year ecommerce revenue growth, an 18-fold surge in adjusted EBIT, and a $50 billion buyback program, Naspers has positioned itself as a leader in profitable scale. Its recent acquisitions of Despegar and Just Eat Takeaway.com—strategic moves to deepen its ecosystem—signal a bold vision for the future. For long-term investors, Naspers offers a rare combination of growth, profitability, and shareholder-friendly capital allocation.

### The Profitability Surge: From Growth to Gains
Naspers' ecommerce portfolio has undergone a remarkable transformation. In FY2025, revenue hit $7.0 billion, up from $6.3 billion in FY2024, driven by iFood's 32% GMV growth, OLX's 20% revenue rise, and Swiggy's 40% Q1 2025 GOV expansion. But the real story is profitability. Adjusted EBIT skyrocketed to $430 million, a staggering 18x increase from $24 million in FY2024. Key drivers include:

- iFood's 178% EBIT jump to $226 million, fueled by its Clube loyalty program and grocery expansion.
- OLX's 61% EBIT growth to $273 million, as margins expanded to 35%.
- eMAG's turnaround, achieving $14 million EBIT after years of losses, thanks to logistics upgrades.


This profitability shift isn't a fluke. Naspers has systematically cut costs, optimized pricing, and focused on high-margin verticals like classifieds and fintech. The result? A $1.0 billion free cash flow in FY2025, up from $375 million the prior year—a critical milestone for sustaining growth.

---

### Buybacks: A Direct Path to Shareholder Value
Naspers' buyback program is the envy of investors. With $50 billion returned to shareholders, it has reduced its free-float and boosted NAV per share by 15%. This isn't just about appeasing shareholders; it's a strategic move to capitalize on undervalued shares.

Consider this: Naspers' net cash position of $2.4 billion and $19.2 billion in cash reserves provide a war chest for further buybacks or acquisitions. The company's open-ended buyback structure ensures flexibility, and its proposal to double dividends to €0.20 per share underscores confidence in its cash flow.

For investors, this means two things:
1. Lower dilution risk as buybacks offset equity issuance.
2. Higher upside potential as a stronger balance sheet supports growth.

---

### Acquisitions: Building an AI-Powered Ecosystem
Naspers' $1.7 billion acquisition of Despegar (Latin America's leading OTA) and its €4.1 billion conditional bid for Just Eat Takeaway.com (Europe's food-delivery giant) are not mere bolt-ons—they're ecosystem plays.

- Despegar: Integrates seamlessly with iFood's Clube loyalty program, creating cross-selling opportunities in travel and food. Its stable margins and $1.7 billion valuation suggest Naspers is buying at a discount to its own multiples.
- Just Eat Takeaway.com: A bid to dominate Europe's food-delivery market, where Naspers can apply its AI-driven playbook (e.g., iFood's hyperlocal logistics). The 49% premium reflects its belief in synergies, such as reducing losses at Just Eat's dark kitchens through operational best practices.

These moves align with Naspers' $100 billion valuation target for its Ecommerce portfolio (excluding Tencent). By linking acquisitions to its core strengths, Naspers is building a vertically integrated ecosystem that competitors can't replicate.

---

### The AI-Driven Edge: Why Naspers Isn't Just Another Ecommerce Player
Naspers isn't just scaling—it's redefining the game with AI. Its $7.8 billion investment in AI-native startups and internal tech initiatives (e.g., Stack Overflow's OverflowAPI) are creating moats. Examples:
- iFood's AI-driven ad targeting: Boosted ad revenue by 30%.
- OLX's AI-powered price prediction: Improved customer trust and retention.
- Swiggy's quick commerce: AI optimizes dark-store locations, driving 101% GOV growth in 2025.

This tech focus isn't just about efficiency—it's about owning the customer experience. As competitors scramble to catch up, Naspers is already ahead.

---

### Risks and Considerations
No investment is without risks. Naspers faces:
- Regulatory hurdles: Antitrust scrutiny on Just Eat Takeaway.com and PayU's credit operations in India.
- Market saturation: High growth in mature markets like Brazil and South Africa may slow.
- Tencent dependency: While reduced, Tencent dividends still contribute to free cash flow.

However, Naspers' diversified portfolio, cash-rich balance sheet, and track record of turning losses into profits mitigate these risks.

---

### Investment Thesis: Buy for Long-Term Growth
Naspers is a buy for investors seeking high-growth, cash-generative stocks with shareholder-friendly policies. Key catalysts include:
1. Ecosystem synergies: Despegar and Just Eat's integration could unlock $100 million+ in annual savings.
2. AI monetization: Stack Overflow's API and iFood's tech could drive margins higher.
3. Buyback accretion: A further 10% NAV boost by FY2026 is achievable.



Price Target: Assuming a 15% NAV accretion and a 10x EV/EBIT multiple for its Ecommerce portfolio, Naspers could hit ZAR 5,000 per share within two years (vs. ZAR 3,200 currently).

---

### Conclusion
Naspers' 21% revenue growth, 18x EBIT surge, and $50 billion buybacks aren't just numbers—they're proof of a systematic strategy to dominate global ecommerce. With AI at its core and disciplined capital allocation, Naspers is primed to outperform in 2026 and beyond. For investors willing to look past short-term volatility, this is a once-in-a-decade opportunity to own a tech titan in the making.

Action Item: Add Naspers to your watchlist. The stock's current valuation, ecosystem strength, and buyback program make it a compelling long-term growth investment.