Once a market darling, Boohoo (BOO) has yet to get past the scandal that befell it in the summer of 2020. Having been the subject of serious allegations around suppliers’ working practices in July last year, the retail giant has since undertaken all manner of measures to tackle supply chain concerns – most recently publishing a list of its 1,100 international suppliers. While the latest report into its efforts notes substantial progress on various fronts, author Sir Brian Leveson adds that this is “merely the end of the beginning”.
The broad extent of the problems and the difficulty of rebuilding a reputation might explain why Boohoo shares are still well down from their June 2020 high, despite positive trading updates over the same period. But Boohoo’s rocky ride isn’t just of concern for private stockpickers: a few popular UK funds have continued to back it heavily.
Once the allegations had surfaced, a couple of ethical UK funds that listed Boohoo as a top 10 holding promptly ditched it. But the stock retains backing among some popular funds without an ESG remit. Some of the small and mid-cap specialists at Jupiter (which acquired Merian, their former employer) continue to have big positions. Boohoo was the top holding in the Jupiter UK Dynamic Equity fund (IE00BLP59769), run by Luke Kerr, and the second-biggest holding for Richard Watts’ Jupiter UK Mid Cap fund (GB00B1XG9482) at the end of August. The Jupiter UK Smaller Companies Focus fund (IE00BLP58C46) managed by David Cameron-Mowat also listed the stock, which made up 3.8 per cent of the portfolio, among its top 10 holdings.