Citibanamex, Disney's Encanto, and Kavak

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Latinometrics Weekly
Welcome to Latinometrics. We bring you Latin American insights and trends through concise, thought-provoking data visualizations. It’s great to have you on board.
Today’s charts
  1. 20 years of revenue history at Citibanamex
  2. Valuation of Kavak and its American counterparts
  3. Disney’s Encanto vs Coco
Make sure you check out the comment of the week at the bottom of this newsletter.

Banking 🏦
The Citibanamex Rollercoaster Ride is Over
The Citibanamex Rollercoaster Ride is Over
Last week, Citi announced its plans to auction off Banamex. The bank justified the move as part of its plan to focus on its “institutional banking operations.” In other words, Citi will now only serve corporations with over $1B in revenues and the ultra-wealthy in Mexico.
In honor of a new chapter for Banamex, here’s a recap of some of its 138-year history:
  • 1884 – Founded by a French banker
  • 1968 – Launched the first credit card in Latin America
  • 1982 – Nationalized by president López Portillo
  • 1992 – Re-privatized by president Salinas de Gortari
  • 2001 – Acquired by Citigroup for $12.5B
  • 2017 – Fined $97M by the US DoJ for enabling money-laundering
  • 2022 – Now up for sale at an estimated $4-8B
We dug deep into Citi’s SEC filings and found that a Mexico exit makes a lot of sense. Not only does the company’s Institutional Clients Group (ICG) branch have much better margins than its Global Consumer Division (GCB – aka Banamex) in Mexico, but it also surpassed it in revenues for the first time in 2019. In 2021, ICG had a 49% profit margin, while GCB had only 19%.
In retrospect, we should’ve all seen this coming. Citi has been selling off its global consumer banks left and right: It sold its Brazil and Argentina banks to Itaú and Santander in 2016. We also suspect that the rise of modern competitors like Nubank, albo, and Clara, could’ve impacted this decision as Citi accepted a defeat in the consumer market.
The big question is now, who will buy Banamex, and what will its future look like? So far, the list of speculated buyers is diverse: Carlos Slim, Ricardo Salinas’ Banco Azteca, a Monterrey-based crypto company. President AMLO also expressed his wish to keep the bank’s Fundación Cultural, a highly valuable art collection, in Mexico.
Auto Industry 🚘
Is Kavak the Next Carvana or Vroom in LatAm?
Is Kavak the Next Carvana or Vroom in LatAm?
Kavak, the first Mexican unicorn, is now valued at $8.7B after raising $700M from Tiger Global Management and Softbank in September. It effectively doubled its valuation for the second time in 2021.
Since Kavak faces little competition in Latin America, we thought of comparing its valuation to its American counterparts. While Kavak has so far thrived during its private funding rounds, Carvana and Vroom have recently struggled in the US public market.
Since its IPO at $22 per share in June 2020, Vroom’s stock soared to a maximum closing price of $73.87 before diving to its most recent close of $7.60. It lost more than 90% of its value after disappointing earnings and reporting issues with its sales operations and inventory management. The leading used car reselling platform in the US, Carvana has been on a similar path, losing around 60% of its value since its peak valuation of $65.7B last August.
The online used car market has plenty of challenges and tough competition in the US. However, Kavak has a lot of room to grow by entering other countries in the region — it entered Brazil and Argentina in early 2021.
Film Industry 🎬
Disney's Encanto is a Global Hit, But Not as Much as Coco
Disney's Encanto is a Global Hit, But Not as Much as Coco
Disney’s new animated film, Encanto, has received positive feedback from film critics and audiences alike. The movie is about a family from Colombia who lives in a magical house and has extraordinary gifts. The visuals are stunning, and the storyline is phenomenal.
Despite its immense success, Encanto hasn’t reached the popularity of Disney Pixar’s 2017 Coco, according to Google Trends. The plot of Coco takes place during Mexico’s “Día de Los Muertos.” Our chart shows its enduring impact: global interest has continued to peak yearly around the holiday (Nov. 1) since its release.
With a worldwide box office of $807M, Coco sits as Wikipedia’s #20 highest-grossing animated film of all time. On the other hand, Encanto has so far grossed $222M at the box office. However, Encanto was released during a different era: post-COVID, and with the option to stream on Disney+.
Directed by Byron Howard and Jared Bush, the movie features the voices of Latin stars Stephanie Beatriz, Olga Lucía Vives (Spanish version), and Maluma. It includes songs written by Lin-Manuel Miranda and sung by Carlos Vives. With such a cast, some have even admitted breaking into tears while watching. Disney once again shined a light on the magic of Latin American culture for all the world to see.
That’s all for this week 👋
Want more?
Here’s the comment of the week. It came from our Mercado Pago chart on LinkedIn:
Comment of the Week (LinkedIn)
Comment of the Week (LinkedIn)
Join the discussion on social media, where we’ll be posting today’s charts throughout the week. Follow us on TwitterLinkedInInstagram, or Facebook. We also opened a Telegram channel.
Feedback or chart suggestions? Reply to this email, and we’ll get back to you by the end of the day.
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