Frasers Group, the retail empire owned by billionaire Mike Ashley, has increased its stake in online electrical retailer AO World to 25.01 per cent, according to a recent regulatory filing.

The move represents a slight increase from the company's previous holding of 24.02 per cent, further consolidating its position as the second-largest shareholder in the business.

The stake increase comes shortly after AO World's positive trading update, which raised its full-year profit forecast. The retailer now expects adjusted pre-tax profits to be between £39m and £44m for the year ending March 31, 2025.

This latest investment is part of Frasers Group's broader strategy of expanding its portfolio across multiple retail sectors. The company has already established significant stakes in other prominent retailers, including Asos, Hugo Boss, Currys, and N Brown.

Just days prior to the AO World stake increase, Frasers Group had similarly raised its holding in online fashion retailer Asos to 25.13 per cent from 24.21 per cent. This move follows a similar stake increase by Asos' largest shareholder, Danish billionaire Anders Holch Povlsen's Bestseller, which recently upped its stake to 28 per cent.

The increasing shareholder activity has sparked speculation about potential takeover movements in the retail sector. Under UK acquisition rules, an investor reaching a 30 per cent stake would be required to make a mandatory offer to the company's shareholders.

"Frasers Group continues to demonstrate a strategic approach to investment in the retail space," said an industry analyst who wished to remain anonymous. "These calculated stake increases suggest a longer-term interest in these businesses."

The company's persistent investment strategy comes as the retail sector continues to navigate challenging economic conditions, with online retailers seeking to maintain competitive positions in an increasingly digital marketplace.

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