Hardman & Co Research: Value-added, customer-driven expansion from core

MCL's recent results (see our 21 October note, Interim FY'20 results: steady core, deal upside) highlighted the strength of Home Collect (HCC). The division showed operational efficiency improvements, the appropriate use of technology and improving credit. It also generated double-digit underlying profit growth, despite a stable market and without compromising the agent-driven model. In this note, we explore MCL's strategy to expand from this strong core business. The strategy is driven by extensive customer surveys, and could see a doubling in both the number of customers and the share of wallet over the medium term. Investment is being paced to balance short- and long-term profitability.

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