FRED TRAJANO: QUEDA DA MAGALU, BETS, CHINA E A CRISE DO VAREJO BRASILEIRO | Market Makers #385

Summary

Fred Trajano, CEO of Magalu, discusses his 10-year tenure, the company's digital transformation, the impact of high interest rates on its stock (MGLU3), and his long-term conviction despite market pessimism. He outlines the next cycle focused on AI commerce via WhatsApp, criticizes the tax exemption for Chinese cross-border e-commerce as unfair, and labels online betting a serious economic and public health problem.

• Fred details Magalu's evolution from a traditional retailer to a digital ecosystem, growing GMV from 10B to 65B reais.
• He stresses that physical retail still represents 85% of Brazilian sales and must offer experiences.
• The new strategic cycle is AI commerce; the WhatsApp da Lu agent already generated over R$100M in sales with triple the app conversion rate.
• He attributes Magalu's stock underperformance to high interest rates and cyclicality but maintains long-term conviction in the company's fundamentals.
• Fred condemns the exemption of import taxes for Chinese cross-border e-commerce, calling it unfair competition that destroys Brazilian jobs.
• He views online betting as a drain on consumption and a public health crisis that requires stringent regulation or outright prohibition.
• Despite macro headwinds, Magalu has returned to profitability and retained its top leadership team.